<PAGE>
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
For the fiscal year ended December 31, 1998
OR
[ ] TRANSITION REPORT PURSUANT TO SECTION 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934
For the transition period from to
Commission file number 1-10410
A. Full title of the plan and address of the plan, if different
from that of the issuer named below:
Harrah's Entertainment, Inc.
Savings and Retirement Plan
B. Name of issuer of the securities held pursuant to the plan and
the address of its principal executive office:
Harrah's Entertainment, Inc.
1023 Cherry Road
Memphis, Tennessee 38117
<PAGE>
REPORT OF INDEPENDENT PUBLIC ACCOUNTANTS
----------------------------------------
To the Trustees of Harrah's Entertainment, Inc.
Savings and Retirement Plan:
We have audited the accompanying statements of net assets available for
benefits, with fund information, of HARRAH'S ENTERTAINMENT, INC. SAVINGS AND
RETIREMENT PLAN as of December 31, 1998 and 1997, and the related statements of
changes in net assets available for benefits, with fund information, for each of
the three years ended December 31, 1998. These financial statements and the
schedules referred to below are the responsibility of the Plan Administrator.
Our responsibility is to express an opinion on these financial statements and
schedules 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, with fund
information, of Harrah's Entertainment, Inc. Savings and Retirement Plan as of
December 31, 1998 and 1997, and the changes in its net assets available for
benefits, with fund information, for each of the three years ended December 31,
1998, 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 of assets
held for investment purposes as of December 31, 1998 (Exhibit I), of loans or
fixed income obligations in default as of December 31, 1998 (Exhibit II) and
of reportable transactions for the year ended December 31, 1998 (Exhibit III)
are presented for purposes of additional analysis and are not a required part
of the basic financial statements, but are supplementary information
<PAGE>
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
statements of changes in net assets available for benefits is presented for
purposes of additional analysis rather than to present the net assets available
for benefits and changes in net assets available for benefits of each fund. 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.
ARTHUR ANDERSEN LLP
Memphis, Tennessee,
June 1, 1999.
<PAGE>
HARRAH'S ENTERTAINMENT, INC.
SAVINGS AND RETIREMENT PLAN
STATEMENT OF NET ASSETS AVAILABLE FOR BENEFITS, WITH FUND INFORMATION
AS OF DECEMBER 31, 1998
<TABLE>
<CAPTION>
Fund Information
-----------------------------------------------------------------------
Participant Directed Funds
-----------------------------------------------------------------------
Company Aggressive S&P 500 Long-Term Income
Stock Fund Stock Fund Index Fund Bond Fund Fund
------------ ----------- ------------ ----------- -----------
<S> <C> <C> <C> <C> <C>
ASSETS
Investments (Notes 1, 2 and 3)
Harrah's common stock $ 97,766,963 $ - $ - $ - $ -
Registered investment company - 26,407,990 - 12,318,879 59,100,110
Common/collective trust fund - - 100,073,839 - -
Short-term investment fund 4,359,863 97,593 206,107 29,642 111,368
Receivables
Due from participants (Note 1) - - - - -
Interest and dividends 17,028 - - 229,409 -
Due (to) from other funds 286,338 8,836 828,025 (122,428) (3,103)
Cash 4,696 1,735 3,473 513 1,610
------------ ----------- ------------ ----------- -----------
Total assets 102,434,888 26,516,154 101,111,444 12,456,015 59,209,985
------------ ----------- ------------ ----------- -----------
LIABILITIES
Accrued expenses (204,932) (41,501) (92,076) (6,803) (38,540)
Accounts payable (6,495) (4,603) (10,865) (1,337) (4,679)
------------ ----------- ------------ ----------- -----------
Total liabilities (211,427) (46,104) (102,941) (8,140) (43,219)
------------ ----------- ------------ ----------- -----------
NET ASSETS AVAILABLE FOR BENEFITS $102,223,461 $26,470,050 $101,008,503 $12,447,875 $59,166,766
============ =========== ============ =========== ===========
<CAPTION>
Fund Information
---------------------------------------------------
Non-
Participant
Participant Directed
Directed Funds Fund
------------------------ ----------
Treasury Executive
Fund Life Fund ESOP Fund Loan Fund Total
----------- ---------- ---------- ----------- ------------
(Note 5)
<S> <C> <C> <C> <C> <C>
ASSETS
Investments (Notes 1 and 2)
Harrah's common stock $ - $ - $7,079,910 $ - $104,846,873
Registered investment company - - - - 97,826,979
Common/collective trust fund - - - - 100,073,839
Short-term investment fund 25,875,361 1,142,271 165,377 10,765 31,998,347
Receivables
Due from participants (Note 1) - - - 24,183,191 24,183,191
Interest and dividends 113,688 5 569 - 360,699
Due (to) from other funds (993,734) - - (3,934) -
Cash 836 - - - 12,863
----------- ---------- ---------- ----------- ------------
Total assets 24,996,151 1,142,276 7,245,856 24,190,022 359,302,791
----------- ---------- ---------- ----------- ------------
LIABILITIES
Accrued expenses (18,873) - (308) - (403,033)
Accounts payable (6,460) - (324) - (34,763)
----------- ---------- ---------- ----------- ------------
Total liabilities (25,333) - (632) - (437,796)
----------- ---------- ---------- ----------- ------------
NET ASSETS AVAILABLE FOR BENEFITS $24,970,818 $1,142,276 $7,245,224 $24,190,022 $358,864,995
=========== ========== ========== =========== ============
</TABLE>
The accompanying Notes to Financial Statements are an integral part of
this statement.
<PAGE>
HARRAH'S ENTERTAINMENT, INC.
SAVINGS AND RETIREMENT PLAN
STATEMENT OF NET ASSETS AVAILABLE FOR BENEFITS, WITH FUND INFORMATION
AS OF DECEMBER 31, 1997
<TABLE>
<CAPTION>
Fund Information
-----------------------------------------------------------------------
Participant Directed Funds
-----------------------------------------------------------------------
Company Aggressive S&P 500 Long-Term Income
Stock Fund Stock Fund Index Fund Bond Fund Fund
------------ ----------- ----------- ---------- -----------
<S> <C> <C> <C> <C> <C>
ASSETS
Investments (Notes 1, 2 and 3)
Harrah's common stock $120,795,432 $ - $ - $ - $ -
Registered investment company - 27,181,908 - 7,620,196 -
Common/collective trust fund - - 75,016,238 - -
Guaranteed investment contracts - - - - -
Corporate securities - - - - 30,037
U.S. government and agency
securities - - - - 39,058
Temporary investments 2,122,448 881,714 1,198,497 158,392 51,138,731
Receivables
Due from participants (Note 1) - - - - -
Interest and dividends - - - - 61,386
Due (to) from other funds (450,495) (209,556) 72,263 630,815 413,117
Pending trades - - - - 1,348,807
Other - - - - -
Cash 847,901 352,238 478,790 63,276 853,997
------------ ----------- ----------- ---------- -----------
Total assets 123,315,286 28,206,304 76,765,788 8,472,679 53,885,133
------------ ----------- ----------- ---------- -----------
LIABILITIES
Advances from Harrah's - - - - -
Bank overdrafts (588,125) (244,321) (332,101) (43,890) (169,708)
Accrued expenses (100,470) (37,777) (59,832) (6,660) (38,641)
Accounts payable (204,734) (64,967) (121,044) (30,735) (75,916)
Other (9,716) (452) (611) (80) (311)
------------ ----------- ----------- ---------- -----------
Total liabilities (903,045) (347,517) (513,588) (81,365) (284,576)
------------ ----------- ----------- ---------- -----------
NET ASSETS AVAILABLE FOR BENEFITS $122,412,241 $27,858,787 $76,252,200 $8,391,314 $53,600,557
============ =========== =========== ========== ===========
<CAPTION>
Fund Information
---------------------------------------------------
Non-
Participant
Participant Directed
Directed Funds Fund
------------------------ ----------
Treasury Executive
Fund Life Fund ESOP Fund Loan Fund Total
----------- ---------- ---------- ----------- ------------
(Note 5)
<S> <C> <C> <C> <C> <C>
ASSETS
Investments (Notes 1, 2 and 3)
Harrah's common stock $ - $ - $9,299,675 $ - $130,095,107
Registered investment company 22,248,346 - - - 57,050,450
Common/collective trust fund - - - - 75,016,238
Guaranteed investment contracts - 7,988,711 - - 7,988,711
Corporate securities - - - - 30,037
U.S. government and agency
securities - - - - 39,058
Temporary investments 306,224 466,107 - - 56,272,113
Receivables
Due from participants (Note 1) - - - 21,453,556 21,453,556
Interest and dividends - - - - 61,386
Due (to) from other funds (483,299) 18,745 8,410 - -
Pending trades - - - - 1,348,807
Other - 78,538 - - 78,538
Cash 122,334 - - - 2,718,536
----------- ---------- ---------- ----------- ------------
Total assets 22,193,605 8,552,101 9,308,085 21,453,556 352,152,537
----------- ---------- ---------- ----------- ------------
LIABILITIES
Advances from Harrah's - (2,340,947) - - (2,340,947)
Bank overdrafts (84,854) - - - (1,462,999)
Accrued expenses (13,904) - - - (257,284)
Accounts payable (39,957) (552,032) - - (1,089,385)
Other (158) - - - (11,328)
----------- ---------- ---------- ----------- ------------
Total liabilities (138,873) (2,892,979) - - (5,161,943)
----------- ---------- ---------- ----------- ------------
NET ASSETS AVAILABLE FOR BENEFITS $22,054,732 $5,659,122 $9,308,085 $21,453,556 $346,990,594
=========== ========== ========== =========== ============
</TABLE>
The accompanying Notes to Financial Statements are an integral part of
this statement.
<PAGE>
HARRAH'S ENTERTAINMENT, INC.
SAVINGS AND RETIREMENT PLAN
STATEMENT OF CHANGES IN NET ASSETS AVAILABLE FOR BENEFITS, WITH FUND INFORMATION
FOR THE YEAR ENDED DECEMBER 31, 1998
<TABLE>
<CAPTION>
Fund Information
-----------------------------------------------------------------------
Participant Directed Funds
-----------------------------------------------------------------------
Company Aggressive S&P 500 Long-Term Income
Stock Fund Stock Fund Index Fund Bond Fund Fund
------------ ----------- ----------- ---------- -----------
<S> <C> <C> <C> <C> <C>
NET INVESTMENT INCOME
Interest $ 381,604 $ 28,962 $ 76,561 $ 8,941 $ 50,915
Dividends - - - 908,197 -
------------ ----------- ----------- ---------- -----------
381,604 28,962 76,561 917,138 50,915
------------ ----------- ----------- ---------- -----------
REALIZED GAIN (LOSS) ON INVESTMENTS
Aggregate proceeds 44,270,937 7,727,937 22,152,418 4,212,306 11,894,665
Aggregate cost (40,392,408) (8,343,747) (19,993,398) (4,137,390) (11,554,323)
------------ ----------- ----------- ---------- -----------
Net realized gain (loss) 3,878,529 (615,810) 2,159,020 74,916 340,342
------------ ----------- ----------- ---------- -----------
UNREALIZED NET APPRECIATION
(DEPRECIATION) OF INVESTMENTS (19,357,722) (1,308,361) 19,475,071 (50,483) 3,640,419
------------ ----------- ----------- ---------- -----------
CONTRIBUTIONS
Participants 8,097,933 3,865,866 5,947,595 811,161 2,338,054
Company 5,644,661 2,590,264 4,000,484 557,723 1,683,595
------------ ----------- ----------- ---------- -----------
13,742,594 6,456,130 9,948,079 1,368,884 4,021,649
OTHER
Distributions to participants and
beneficiaries (9,687,407) (3,048,048) (8,159,430) (1,149,397) (6,519,340)
Transfers between funds (8,390,528) (2,545,639) 1,751,526 2,947,497 4,492,737
Administrative expenses (755,850) (355,971) (494,524) (51,994) (460,513)
------------ ----------- ----------- ---------- -----------
NET INCREASE (DECREASE) IN NET
ASSETS AVAILABLE FOR BENEFITS (20,188,780) (1,388,737) 24,756,303 4,056,561 5,566,209
NET ASSETS AVAILABLE FOR BENEFITS,
Beginning of year 122,412,241 27,858,787 76,252,200 8,391,314 53,600,557
------------ ----------- ----------- ---------- -----------
End of year $102,223,461 $26,470,050 $101,008,503 $12,447,875 $59,166,766
============ =========== ============ =========== ===========
<CAPTION>
Fund Information
---------------------------------------------------
Non-
Participant
Participant Directed
Directed Funds Fund
------------------------ ----------
Treasury Executive
Fund Life Fund ESOP Fund Loan Fund Total
----------- ---------- ---------- ----------- ------------
(Note 5)
<S> <C> <C> <C> <C> <C>
NET INVESTMENT INCOME
Interest $ 1,317,409 $1,089,215 $ 58,078 $ 1,441,977 $ 4,453,662
Dividends - - - - 908,197
----------- ---------- ---------- ----------- ------------
1,317,409 1,089,215 58,078 1,441,977 5,361,859
----------- ---------- ---------- ----------- ------------
REALIZED GAIN (LOSS) ON INVESTMENTS
Aggregate proceeds - - - - 90,258,263
Aggregate cost - - - - (84,421,266)
----------- ---------- ---------- ----------- ------------
Net realized gain (loss) - - - - 5,836,997
----------- ---------- ---------- ----------- ------------
UNREALIZED NET APPRECIATION
(DEPRECIATION) OF INVESTMENTS - 395,825 (1,387,327) - 1,407,422
----------- ---------- ---------- ----------- ------------
CONTRIBUTIONS
Participants 1,403,677 - - - 22,464,286
Company 876,483 - 25 - 15,353,235
----------- ---------- ---------- ----------- ------------
2,280,160 - 25 - 37,817,521
OTHER
Distributions to participants and
beneficiaries (4,541,794) (269,206) (712,278) (2,229,587) (36,316,487)
Transfers between funds 3,970,947 (5,732,680) (17,936) 3,524,076 -
Administrative expenses (110,636) - (3,423) - (2,232,911)
----------- ---------- ---------- ----------- ------------
NET INCREASE (DECREASE) IN NET
ASSETS AVAILABLE FOR BENEFITS 2,916,086 (4,516,846) (2,062,861) 2,736,466 11,874,401
NET ASSETS AVAILABLE FOR BENEFITS,
Beginning of year 22,054,732 5,659,122 9,308,085 21,453,556 346,990,594
----------- ---------- ---------- ----------- ------------
End of year $24,970,818 $1,142,276 $ 7,245,224 $24,190,022 $358,864,995
=========== ========== =========== =========== ============
</TABLE>
The accompanying Notes to Financial Statements are an integral part of
this statement.
<PAGE>
HARRAH'S ENTERTAINMENT, INC.
SAVINGS AND RETIREMENT PLAN
STATEMENT OF CHANGES IN NET ASSETS AVAILABLE FOR BENEFITS, WITH FUND INFORMATION
FOR THE YEAR ENDED DECEMBER 31, 1997
<TABLE>
<CAPTION>
Fund Information
-----------------------------------------------------------------------
Participant Directed Funds
-----------------------------------------------------------------------
Company Aggressive S&P 500 Long-Term Income
Stock Fund Stock Fund Index Fund Bond Fund Fund
------------ ----------- ----------- ---------- -----------
<S> <C> <C> <C> <C> <C>
NET INVESTMENT INCOME
Interest $ 207,435 $ 36,094 $ 103,055 $ 10,731 $ 3,958,749
Dividends - 2,493,299 - 548,485 604,594
------------ ----------- ----------- ---------- -----------
207,435 2,529,393 103,055 559,216 4,563,343
------------ ----------- ----------- ---------- -----------
REALIZED GAIN (LOSS) ON INVESTMENTS
Aggregate proceeds 13,455,144 357,037 3,095,294 3,472,373 426,467,256
Aggregate cost (13,326,188) (363,806) (2,826,113) (3,510,300) (427,259,849)
------------ ----------- ----------- ---------- -----------
Net realized gain (loss) 128,956 (6,769) 269,181 (37,927) (792,593)
------------ ----------- ----------- ---------- -----------
UNREALIZED NET APPRECIATION
(DEPRECIATION) OF INVESTMENTS (6,135,421) 1,228,569 17,306,583 349,162 (620,801)
------------ ----------- ----------- ---------- -----------
CONTRIBUTIONS
Participants 8,842,945 3,189,152 4,086,540 591,768 3,567,373
Company 6,550,364 2,195,211 2,836,051 422,475 1,803,608
------------ ----------- ----------- ---------- -----------
15,393,309 5,384,363 6,922,591 1,014,243 5,370,981
OTHER
Distributions to participants and
beneficiaries (11,986,354) (2,514,096) (7,303,377) (651,488) (7,610,485)
Transfers between funds (11,911,103) 2,657,661 6,087,107 (1,675,667) (3,514,232)
Administrative expenses (594,339) (250,358) (356,935) (53,759) (384,605)
------------ ----------- ----------- ---------- -----------
NET INCREASE (DECREASE) IN NET
ASSETS AVAILABLE FOR BENEFITS (14,897,517) 9,028,763 23,028,205 (496,220) (2,988,392)
NET ASSETS AVAILABLE FOR BENEFITS,
Beginning of year 137,309,758 18,830,024 53,223,995 8,887,534 56,588,949
------------ ----------- ----------- ---------- -----------
End of year $122,412,241 $27,858,787 $76,252,200 $8,391,314 $53,600,557
============ =========== =========== ========== ===========
<CAPTION>
Fund Information
---------------------------------------------------
Non-
Participant
Participant Directed
Directed Funds Fund
------------------------ ----------
Treasury Executive
Fund Life Fund ESOP Fund Loan Fund Total
----------- ---------- ---------- ----------- ------------
(Note 5)
<S> <C> <C> <C> <C> <C>
NET INVESTMENT INCOME
Interest $ 19,457 $ 21,029 $ - $ 1,445,731 $ 5,802,281
Dividends 886,789 - - - 4,533,167
----------- ---------- ---------- ----------- ------------
906,246 21,029 - 1,445,731 10,335,448
----------- ---------- ---------- ----------- ------------
REALIZED GAIN (LOSS) ON INVESTMENTS
Aggregate proceeds 3,475,184 - 1,134,111 - 451,456,399
Aggregate cost (3,475,184) - (988,066) - (451,749,506)
----------- ---------- ---------- ----------- ------------
Net realized gain (loss) - - 146,045 - (293,107)
----------- ---------- ---------- ----------- ------------
UNREALIZED NET APPRECIATION
(DEPRECIATION) OF INVESTMENTS - 735,257 (649,967) - 12,213,382
----------- ---------- ---------- ----------- ------------
CONTRIBUTIONS
Participants 1,126,452 - - - 21,404,230
Company 806,745 - 69 - 14,614,523
----------- ---------- ---------- ----------- ------------
1,933,197 - 69 - 36,018,753
OTHER
Distributions to participants and
beneficiaries (5,754,658) (514,583) (873,965) (1,100,736) (38,309,742)
Transfers between funds 8,962,818 - (27,455) (579,129) -
Administrative expenses (71,106) - (1,109) - (1,712,211)
----------- ---------- ---------- ----------- ------------
NET INCREASE (DECREASE) IN NET
ASSETS AVAILABLE FOR BENEFITS 5,976,497 241,703 (1,406,382) (234,134) 18,252,523
NET ASSETS AVAILABLE FOR BENEFITS,
Beginning of year 16,078,235 5,417,419 10,714,467 21,687,690 328,738,071
----------- ---------- ---------- ----------- ------------
End of year $22,054,732 $5,659,122 $9,308,085 $21,453,556 $346,990,594
=========== ========== ========== =========== ============
</TABLE>
The accompanying Notes to Financial Statements are an integral part of
this statement.
<PAGE>
HARRAH'S ENTERTAINMENT, INC.
SAVINGS AND RETIREMENT PLAN
STATEMENT OF CHANGES IN NET ASSETS AVAILABLE FOR BENEFITS, WITH FUND INFORMATION
FOR THE YEAR ENDED DECEMBER 31, 1996
<TABLE>
<CAPTION>
Fund Information
-----------------------------------------------------------------------
Participant Directed Funds
-----------------------------------------------------------------------
Company Aggressive S&P 500 Long-Term Income
Stock Fund Stock Fund Index Fund Bond Fund Fund
------------ ----------- ----------- ---------- -----------
<S> <C> <C> <C> <C> <C>
NET INVESTMENT INCOME
Interest $ 85,149 $ 8,625 $ 24,784 $ 4,662 $ 4,119,998
Dividends - 1,443,087 - 716,785 215,529
------------ ----------- ----------- ---------- -----------
85,149 1,451,712 24,784 721,447 4,335,527
------------ ----------- ----------- ---------- -----------
REALIZED GAIN (LOSS) ON INVESTMENTS
Aggregate proceeds 14,523,763 1,033,468 4,104,657 1,088,641 369,001,219
Aggregate cost (9,349,397) (997,824) (3,079,235) (1,085,122) (369,936,453)
------------ ----------- ----------- ---------- -----------
Net realized gain (loss) 5,174,366 35,644 1,025,422 3,519 (935,234)
------------ ----------- ----------- ---------- -----------
UNREALIZED NET APPRECIATION
(DEPRECIATION) OF INVESTMENTS (31,200,751) 108,890 8,535,784 (604,669) (1,297,829)
------------ ----------- ----------- ---------- -----------
CONTRIBUTIONS
Participants 10,971,541 2,438,787 3,112,800 563,096 2,850,745
Company 7,492,343 1,556,769 2,006,493 389,196 2,017,605
------------ ----------- ----------- ---------- -----------
18,463,884 3,995,556 5,119,293 952,292 4,868,350
OTHER
Distributions to participants and
beneficiaries (13,300,851) (1,476,339) (3,990,424) (472,704) (6,439,459)
Transfers between funds (2,627,784) 5,738,338 4,058,146 213,219 (6,466,019)
Administrative expenses (756,772) (250,745) (333,707) (54,044) (88,717)
------------ ----------- ----------- ---------- -----------
NET INCREASE (DECREASE) IN NET
ASSETS AVAILABLE FOR BENEFITS (24,162,759) 9,603,056 14,439,298 759,060 (6,023,381)
NET ASSETS AVAILABLE FOR BENEFITS,
Beginning of year 161,472,517 9,226,968 38,784,697 8,128,474 62,612,330
------------ ----------- ----------- ---------- -----------
End of year $137,309,758 $18,830,024 $53,223,995 $8,887,534 $56,588,949
============ =========== =========== ========== ===========
<CAPTION>
Fund Information
---------------------------------------------------
Non-
Participant
Participant Directed
Directed Funds Fund
------------------------ ----------
Treasury Executive
Fund Life Fund ESOP Fund Loan Fund Total
----------- ---------- ---------- ----------- ------------
(Note 5)
<S> <C> <C> <C> <C> <C>
NET INVESTMENT INCOME
Interest $ 8,581 $ 11,553 $ 118 $ 1,527,305 $ 5,790,775
Dividends 844,585 - - - 3,219,986
----------- ---------- ---------- ----------- ------------
853,166 11,553 118 1,527,305 9,010,761
----------- ---------- ---------- ----------- ------------
REALIZED GAIN (LOSS) ON INVESTMENTS
Aggregate proceeds 3,137,358 - 1,022,357 - 393,911,463
Aggregate cost (3,137,358) - (999,591) - (388,584,980)
----------- ---------- ---------- ----------- ------------
Net realized gain (loss) - - 22,766 - 5,326,483
----------- ---------- ---------- ----------- ------------
UNREALIZED NET APPRECIATION
(DEPRECIATION) OF INVESTMENTS - (1,131,082) (2,462,944) - (28,052,601)
----------- ---------- ---------- ----------- ------------
CONTRIBUTIONS
Participants 1,011,163 - - - 20,948,132
Company 656,236 - - - 14,118,642
----------- ---------- ---------- ----------- ------------
1,667,399 - - - 35,066,774
OTHER
Distributions to participants and
beneficiaries (2,787,806) (511,468) (755,793) - (29,734,844)
Transfers between funds 827,018 (2,886) (50,122) (1,689,910) -
Administrative expenses (65,162) - (264,552) - (1,813,699)
----------- ---------- ---------- ----------- ------------
NET INCREASE (DECREASE) IN NET
ASSETS AVAILABLE FOR BENEFITS 494,615 (1,633,883) (3,510,527) (162,605) (10,197,126)
NET ASSETS AVAILABLE FOR BENEFITS,
Beginning of year 15,583,620 7,051,302 14,224,994 21,850,295 338,935,197
----------- ---------- ---------- ----------- ------------
End of year $16,078,235 $5,417,419 $10,714,467 $21,687,690 $328,738,071
=========== ========== =========== =========== ============
</TABLE>
The accompanying Notes to Financial Statements are an integral part of
this statement.
<PAGE>
HARRAH'S ENTERTAINMENT, INC.
SAVINGS AND RETIREMENT PLAN
NOTES TO FINANCIAL STATEMENTS
DECEMBER 31, 1998
NOTE 1 - SUMMARY DESCRIPTION OF THE PLAN
- ----------------------------------------
The following description of the Harrah's Entertainment, Inc. Savings and
Retirement Plan (the "Plan," formerly The Promus Companies Incorporated Savings
and Retirement Plan) is provided for general information purposes only.
Reference should be made to the Plan Document for a more complete description of
the Plan's provisions.
The Plan
- --------
Effective June 30, 1995, The Promus Companies Incorporated ("Promus") was
split into two independent public corporations (the "Spin-off"). Promus,
which was renamed Harrah's Entertainment, Inc. ("Harrah's"), retained the
casino entertainment business. Promus' hotel operations were transferred to a
newly created company, Promus Hotel Corporation ("PHC"). The agreements
governing the terms of the Spin-off transaction required that the assets
allocable to those participants in the Plan, who became employees of PHC, be
transferred to a new savings and retirement plan (the "PHC Plan"), which was
established for the benefit of the eligible employees of PHC and its
affiliates. Concurrent with the completion of the Spin-off, the Plan was
renamed the Harrah's Entertainment, Inc. Savings and Retirement Plan.
Participants' investments in Promus common stock through the Company Stock
Fund and the ESOP Fund were converted into investments in the common stock of
their employer, either Harrah's or PHC, after the Spin-off.
The Plan was established by Harrah's effective February 6, 1990, to include
eligible employees of Harrah's and its affiliates (the "Company") for the
primary purpose of allowing these employees to accumulate capital for their
retirement. Participants can contribute either pre-tax payroll dollars (i.e.,
temporary deferral of federal and/or state income taxes) or after-tax dollars to
the Plan, as provided for under Sections 401(k) and 401(m) of the Internal
Revenue Code. The Plan is subject to the provisions of the Employee Retirement
Income Security Act of 1974 ("ERISA").
<PAGE>
NOTE 1 - SUMMARY DESCRIPTION OF THE PLAN (Continued)
- ----------------------------------------------------
Plan Investment Funds
- ---------------------
By election of a participant, his or her account balance (comprised of
contributions, Company matching funds and accumulated earnings) can be invested
in one or in a combination of up to six separate funds (collectively, the
"Funds") of the Plan in 1% increments as follows (10% increments prior to
October 1, 1996):
I. Company Stock Fund - invested in Harrah's common stock which provides a
return based on the change in market value of Harrah's common stock,
including any dividends declared thereon;
II. Aggressive Stock Fund - invested in the SSGA Small Cap Matrix Fund, a
mutual fund comprised primarily of a mix of common stocks of emerging and
other growth-oriented companies, including securities convertible to
common stocks;
III. S&P 500 Index Fund - invested in the State Street Bank & Trust S&P 500
Index Fund, an S&P 500 indexed common/collective trust fund, which
provides a return based on the performance of the stocks included within
the S&P 500 Index Fund, including dividends thereon;
IV. Long-Term Bond Fund - invested in the Vanguard Long-Term Corporate
Portfolio, a mutual fund with investments in a diversified mix of
long-term investment grade bonds;
V. Income Fund - invested in the SSGA Intermediate Bond Fund, a mutual fund
comprised primarily of high quality intermediate-term government,
corporate, mortgage-backed and asset-backed securities; or
VI. Treasury Fund - invested in a commingled fund managed by State Street
Global Advisors, which provides investments in high-quality money market
securities and other short-term debt instruments.
-2-
<PAGE>
NOTE 1 - SUMMARY DESCRIPTION OF THE PLAN (Continued)
- ----------------------------------------------------
The Plan also includes three other special purpose funds, as follows:
I. Executive Life Fund - segregates the assets and participants' equity
accounts related to the investment in Executive Life Insurance Company's
guaranteed investment contract. See Note 5 - Executive Life Investment
for further details.
II. ESOP Fund - accounts for special contributions by Harrah's of its common
stock or cash equivalents to eligible employees. The ESOP Fund was
established within the Plan to serve as a means to monitor the accounts
and records of the participants. Participants are not allowed to make
contributions to their ESOP account and distributions can be made only
after a participant terminates employment.
III. Loan Fund - separately tracks loans to participants as provided for under
the Plan.
Occasionally, the Funds hold cash on a temporary basis pending investment or
withdrawals. Cash balances are invested in temporary investments. At December
31, 1997, the Income Fund held $51.1 million in temporary investments due to the
liquidation of the securities investments in anticipation of the January 2, 1998
transfer of funds to State Street Global Advisors.
Plan Administration
- -------------------
The general administration of the Plan is the responsibility of its Trustees,
who are appointed by the Human Resources Committee of the Harrah's Board of
Directors, and who act as the Plan Administrator. The Trustees perform the
duties and exercise the authority set forth in the Plan and Trustee Agreements.
The Trustees have delegated certain of their authority to individuals for
purposes of day-to-day administration.
-3-
<PAGE>
NOTE 1 - SUMMARY DESCRIPTION OF THE PLAN (Continued)
- ----------------------------------------------------
Effective January 2, 1998, State Street Global Advisors (SSGA) began
administering the Plan. SSGA provides recordkeeping, accounting, daily trading,
trustee, custodial, and investment management services.
Employee Eligibility, Vesting and Termination
- ---------------------------------------------
Employees of the Company become eligible to join the Plan on the first entry
date (January 1 or July 1) following completion of 12 months during which the
employee is credited with at least 1,000 hours of service. Participants vest in
Company matching contributions over seven calendar years of credited service as
follows:
Years of Vested
Credited Service Percentage
------------------ ----------
One 10%
Two 20%
Three 30%
Four 40%
Five 60%
Six 80%
Seven 100%
An employee's active participation in the Plan ceases upon separation of service
at which time his or her vested account balance can either be withdrawn or
remain in the Plan according to the Plan Document.
Plan Expenses
- -------------
As sponsor of the Plan, Harrah's, through its wholly-owned subsidiary, Harrah's
Operating Company, Inc. ("HOC"), initially pays many of the costs associated
with the operation of the Plan. These costs include salaries for employees who
perform administrative services solely for the Plan, rent, various service
charges and other direct costs of operation. The Plan reimbursed HOC for these
costs in the amounts of approximately $790,000, $1.6 million and $1.1 million
for 1998, 1997 and 1996, respectively. Such costs are included in administrative
expenses in the accompanying statements of changes in net assets available for
benefits.
-4-
<PAGE>
NOTE 1 - SUMMARY DESCRIPTION OF THE PLAN (Continued)
- ----------------------------------------------------
Participants' Contributions and Withdrawals
- -------------------------------------------
Participants can elect to make basic contributions ranging from two to six
percent of their eligible earnings, as defined. These contributions are then
matched by the Company. If a non-highly compensated participant is making basic
pre-tax contributions of six percent of his or her earnings to the Plan, the
participant could elect to make supplemental contributions of up to an
additional 10% of which up to 8% can be pre-tax dollars. Highly compensated
employees could contribute up to an additional 10% of after-tax dollars as
supplemental contributions. The Company will match the first six percent of all
participants' contributions.
Participants' contributions, vested matching Company contributions and
related income may be withdrawn by giving notice to the Plan Administrator,
which may include a telephone or electronic communication, subject to Plan
and Internal Revenue Service rules. In-service withdrawals of pre-tax
contributions are subject to hardship rules if the withdrawal occurs before
age 59 1/2.
Withdrawal of basic after-tax and matching contributions will not prohibit
participants from making further contributions; however, if these contributions
or any other funds are withdrawn, the Company will not match subsequent
contributions for six months. Supplemental after-tax contributions and any
earnings thereon may be withdrawn without this penalty. If a participant ceases
to make contributions to the Plan, the participant's equity may remain constant,
except for allocation of earnings, gains and losses on the Plan's investments.
Allocation of Forfeitures and Net Plan Income
- ---------------------------------------------
As required by the Plan, forfeited amounts attributed to non-vested Company
matching contributions of terminated employees will not be reallocated to
remaining participants for a period of five years. Employees who return to
service within that period will be credited, subject to further vesting, at the
date of rehire with the unallocated equity amount. The total amount of potential
forfeitures of terminated non-vested participants at December 31, 1998 was
approximately $4.8 million. Forfeitures are allocated to active participants
based upon their total basic
-5-
<PAGE>
NOTE 1 - SUMMARY DESCRIPTION OF THE PLAN (Continued)
- ----------------------------------------------------
contributions for the year. No funds were reallocated during 1998, but were
reallocated during the first quarter of 1999 in the amount of $0.9 million. The
Plan Administrator reallocated approximately $0.5 million and $0.3 million of
forfeited funds during 1997 and 1996, respectively.
Net Plan income (i.e. unrealized appreciation/depreciation of investments,
dividend and interest income, and realized gains or losses on the sale of
investments) is allocated daily to active participants based upon the
individual's prior daily equity balance. For purposes of calculating the
realized gains or losses on investments, the Plan uses the revalued cost (i.e.
the fair value of the assets at the beginning of the current plan year).
Loans
- -----
Loans may be made to participants by giving notice to the Plan Administrator,
which may include a telephone or electronic communication. All loans, other than
those used to acquire or construct the principal residence of the participant,
shall be repaid within five years. The minimum amount that may be borrowed is
$500. The balance of loans outstanding under the Plan to a participant may not
exceed $50,000 (which maximum is subject to reduction if another loan is
outstanding) or one-half of the vested balance of the participant's account,
whichever is less. Loans bear interest at a rate set by the Plan Administrator,
and are secured by the account balance of the participant equal to the
outstanding loan amount. Principal and interest paid by a participant are
credited to the participant's account. At December 31, 1998 and 1997, these
loans had interest rates ranging from 7.5% to 9.5%.
Accounting Policies
- -------------------
The American Institute of Certified Public Accountants issued Statement of
Position 94-4 ("SOP 94-4"), "Reporting of Investment Contracts Held by Health
and Welfare Benefit Plans and Defined-Contribution Pension Plans," effective for
fiscal years beginning after December 15, 1994. SOP 94-4 changed the Plan's
reporting for certain investment contracts (as defined in SOP 94-4) from
-6-
<PAGE>
NOTE 1 - SUMMARY DESCRIPTION OF THE PLAN (Continued)
- ----------------------------------------------------
contract value to fair market value. The Plan adopted SOP 94-4 during 1996,
which resulted in a reduction in the carrying value of the Executive Life
Insurance guaranteed investment contract of approximately $1.1 million. The
changes in market value for 1998 and 1997 are included in unrealized
appreciation (depreciation) of investments in the accompanying statement of
changes in net assets available for benefits. The contract value was
approximately $8.4 million as of December 31, 1997. As of December 31, 1998, the
Plan no longer held an investment in the Executive Life Insurance guaranteed
investment contract. See Note 5 for further discussion.
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 amounts of income and expenses during the reporting period. Actual results
could differ from those estimates.
NOTE 2 - VALUATION OF INVESTMENTS
- ---------------------------------
Investments in securities, common/collective trust funds and registered
investment companies are stated at market values on the last business day of the
plan year.
NOTE 3 - INVESTMENTS
- --------------------
The fair market values of individual investments that represent 5% or more of
the Plan's total net assets as of December 31, 1998 and 1997, were as follows:
-7-
<PAGE>
1998 1997
------------ ------------
Harrah's Entertainment, Inc. Common
Stock $104,846,873 $130,095,107
Delaware Trend Institutional Fund - 27,181,908
Dreyfus Treasury Fund - 22,248,346
State Street Bank & Trust S&P 500
Index Fund 100,073,839 75,016,238
Fidelity Instiutional Cash-U.S
Govt. Portfolio - 50,526,283
SSGA Small Cap Matrix Fund Series A 26,407,990 -
SSGA Intermediate Bond Fund Series A 59,100,110 -
SSB Yield Enhanced Short-Term
Investment Fund 25,809,653 -
Loans to Participants 24,183,191 21,453,556
NOTE 4 - EXCESS CONTRIBUTIONS
- -----------------------------
Certain plan participants received a refund of a portion of their
contributions and attributable earnings totaling approximately $152,000 and
$54,000 in 1997 and 1996, respectively. No refunds were required for 1998.
These refunds were paid in accordance with Internal Revenue Code Section
401(m), which requires that certain nondiscriminatory tests related to the
overall composition of participants' contributions be met, and Section 415,
which requires annual contributions not to exceed 25% of the participant's
compensation, as defined.
NOTE 5 - EXECUTIVE LIFE INVESTMENT
- ----------------------------------
On May 1, 1991, the Plan was amended to provide that approximately $12.9 million
attributable to a guaranteed investment contract issued by Executive Life
Insurance Company ("Executive Life") and held in the Plan's Income Investment
Fund would be frozen until such time as the contract was finally paid out. The
$12.9 million represented the book value of this contract as of March 31, 1991.
The action was taken by the Company due to the conservatorship
-8-
<PAGE>
NOTE 5 - EXECUTIVE LIFE INVESTMENT (Continued)
- ----------------------------------------------
imposed on Executive Life by the State of California Insurance Commissioner. The
Company agreed to pay to the Plan any deficiency between the $12.9 million and
any amounts finally paid under the contract. The Company also agreed to make
interest free loans to the Plan, which were to be repaid out of any amounts
received under the contract, so that persons who leave or who had already left
the Company's employment may withdraw the vested portion of the Executive Life
guaranteed investment contract, as well as other vested funds. Amounts loaned to
the Plan are reflected in the accompanying statements of net assets available
for benefits as advances from Harrah's.
On September 3, 1993, the California Department of Insurance closed on a
rehabilitation transaction with Aurora National Life Assurance Company
("Aurora"), whereby substantially all Executive Life assets and restructured
liabilities were transferred to Aurora. Additionally, on September 3, 1993,
Aurora made a payment of approximately $1.9 million to the Plan, which reduced
the principal of the Executive Life contract. Of this payment, approximately
$0.4 million was paid to Harrah's to reduce the advances from Harrah's balance.
The remaining amount was used to unfreeze part of the Executive Life Fund for
each participant on a pro-rata basis.
On February 4, 1994, the Plan elected to participate in an ongoing
rehabilitation plan offered by Aurora. This plan provided for recovery of a
minimum of 77.7% of the March 31, 1991 book value.
On July 29, 1996 and again on April 22, 1997, Aurora made a payment of
approximately $0.1 million to the Plan, which reduced the principal of the
Executive Life contract. These payments will be included in the determination of
the allocation of interest earned.
Under the Plan Amendment that governs the Executive Life contract, non-benefit
responsive distributions are allocated pro-rata among the remaining participants
(based upon their investment in the contract) and to the Company (based on the
Plan's payable to the Company). Benefit responsive distributions are allocated
to the Company as the Company previously loaned the Plan the funds for the
distributions. In April 1995, Aurora began honoring requests for distributions
for terminated participants, as well as for hardship withdrawals. During 1996,
Aurora discontinued reimbursements for hardship withdrawals. Harrah's remained
liable to the Plan for any deficiency between the book value and amounts
ultimately received.
-9-
<PAGE>
NOTE 5 - EXECUTIVE LIFE INVESTMENT (Continued)
- ----------------------------------------------
The restructured contract matured on September 3, 1998, and $9.2 million was
received by the Plan in September 1998. Of this amount, $8.7 million
represented principal and $0.5 million represented interest earnings. The
principal was allocated to participant accounts to unfreeze the investment
and was used to repay the balance of advances from Harrah's. The Company is
in the process of determining the allocation of the interest earned.
The accounts payable balance for the Executive Life Fund as of December 31,
1997, primarily represents a payable to the PHC Plan for that plan's portion of
the Executive Life contract (see Note 1). The plan administrator repaid the
principal amount to the PHC Plan once the maturity proceeds were received from
Aurora.
NOTE 6 - PLAN QUALIFICATION
- ---------------------------
The Plan is intended to satisfy the tax qualification requirements under Section
401(a) of the Internal Revenue Code ("IRC"); therefore, the trust funds of the
Plan are intended to be exempt from federal income taxes under Section 501(a). A
favorable determination letter regarding the Plan's status, dated November 19,
1992, has been received from the Internal Revenue Service. The Plan has been
amended since receiving the determination letter; however, the plan
administrator and the Plan's legal counsel believe that the Plan is designed and
is currently being operated in compliance with the applicable requirements of
the IRC.
NOTE 7 - 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. In the event of Plan termination,
participants will become 100% vested in their accounts.
NOTE 8 - SUBSEQUENT EVENTS
- --------------------------
Due to the volatility of the stock market, the per share value of Harrah's
common stock has increased from $15.688 at December 31, 1998, to $20.625 at June
1, 1999. This increase in per share
-10-
<PAGE>
NOTE 8 - SUBSEQUENT EVENTS (Continued)
- --------------------------------------
market value would result in an approximately $128.5 million and $9.3 million
balance in Harrah's common stock for the Company Stock Fund and the ESOP Fund,
respectively, if such funds were valued at the June 1, 1999, prices.
Effective January 1, 1999, employees are eligible to begin participating in the
Plan after 90 days of service; however, Company matching contributions continue
to be credited to each participant's account only after the participant has
incurred one year of service with at least 1,000 hours of service during that
year. In addition, the vesting percentages were amended to allow participants to
become fully vested after five years of service.
On January 1, 1999, Showboat Marina Casino Partnership (SMCP) became a
participating employer and SMCP employees were eligible to participate in the
Plan. The account balances of SMCP's employees were transferred from the
Showboat 401(k) plan to this Plan on January 1, 1999, in the amount of $3
million. On July 1, 1999, the Showboat Atlantic City employees will be
eligible to participate in the Plan. With the eligibility of Showboat
employees, the Company added the Fidelity Magellan Fund as a new investment
option effective January 1, 1999.
-11-
<PAGE>
EXHIBIT I
HARRAH'S ENTERTAINMENT, INC.
SAVINGS AND RETIREMENT PLAN
SCHEDULE OF ASSETS HELD FOR INVESTMENT PURPOSES
AS OF DECEMBER 31, 1998
<TABLE>
<CAPTION>
COST MARKET VALUE
------------ ------------
<S> <C> <C>
HARRAH'S ENTERTAINMENT, INC. COMMON STOCK
Company Stock Fund* $ 97,810,080 $ 97,766,963
ESOP Fund* 7,519,085 7,079,910
------------ ------------
105,329,165 104,846,873
------------ ------------
REGISTERED INVESTMENT COMPANIES
SSGA Intermediate Bond Fund Series A 55,529,391 59,100,110
SSGA Small Cap Matrix Fund Series A 27,715,320 26,407,990
Vanguard - Long-Term Corporate Portfolio 12,005,017 12,318,879
------------ ------------
95,249,728 97,826,979
------------ ------------
COMMON/COLLECTIVE TRUST FUND
State Street Bank & Trust S&P 500 Index Fund Series A (Lending) 80,950,485 100,073,839
------------ ------------
LOANS TO PARTICIPANTS, 7.5% to 9.5% 24,183,191 24,183,191
------------ ------------
SHORT-TERM INVESTMENT FUND
SSB Yield Enhanced Short-Term Investment Fund 25,809,653 25,809,653
SSGA Short-Term Investment Fund 4,469,879 4,469,879
Fidelity Money Market Trust 1,718,815 1,718,815
------------ ------------
31,998,347 31,998,347
------------ ------------
TOTAL INVESTMENTS $337,710,916 $358,929,229
============ ============
</TABLE>
* Represents a party-in-interest transaction.
<PAGE>
EXHIBIT II
HARRAH'S ENTERTAINMENT, INC.
SAVINGS AND RETIREMENT PLAN
ITEM 27B - SCHEDULE OF LOANS OR FIXED INCOME OBLIGATIONS
DECEMBER 31, 1998
Identity of Obligor Description of Loan Amount Defaulted
- ------------------------- --------------------------------- ----------------
Various plan participants 95 participant loans with dates $424,644
ranging from 2/1/93 to 5/13/98
with interest rates ranging from
7.5% to 9.5%
<PAGE>
EXHIBIT III
PAGE 1 OF 2
HARRAH'S ENTERTAINMENT, INC.
SAVINGS AND RETIREMENT PLAN
SCHEDULE OF REPORTABLE TRANSACTIONS
FOR THE YEAR ENDED DECEMBER 31, 1998
<TABLE>
<CAPTION>
Current
Value of
Assets on
Purchase Selling Cost of Assets Transaction
Description Price Price Sold Date Gain (Loss)
- ------------------------------------- ------------ ----------- ------------ ----------- -----------
<S> <C> <C> <C> <C> <C>
SERIES OF TRANSACTIONS:
Harrah's Company Stock Fund
Common and Preferred $ 12,097,626 $44,270,937 $(41,218,399) $44,270,937 $ 3,052,538
Fixed Income 37,584,584 33,494,509 (33,494,509) 33,494,509 -
SSGA Intermediate Bond Fund Series A
Common and Preferred 118,509,161 11,894,665 (11,554,323) 11,894,665 340,342
SSGA Small Cap Matrix Fund Series A
Common and Preferred 63,240,974 7,727,937 (8,343,747) 7,727,937 (615,810)
State Street Bank & Trust S&P 500 Index Fund
Series A (Lending) Common and Preferred 176,592,753 22,152,418 (19,993,398) 22,152,418 2,159,020
SSB Yield Enhanced Short-Term Investment
Fund Fixed Income 45,648,510 19,838,857 (19,838,857) 19,838,857 -
Fidelity Institutional Cash
Purchases/sales 1,744,410 52,880,023 (52,880,023) 52,880,023 -
Fidelity Money Market Trust
Purchases/sales 13,099,000 17,235,000 (17,235,000) 17,235,000 -
Delaware Trend Institutional Fund
Purchase/sales - 27,181,908 (27,181,908) 27,181,908 -
</TABLE>
<PAGE>
EXHIBIT III
PAGE 2 OF 2
HARRAH'S ENTERTAINMENT, INC.
SAVINGS AND RETIREMENT PLAN
SCHEDULE OF REPORTABLE TRANSACTIONS
FOR THE YEAR ENDED DECEMBER 31, 1998
<TABLE>
<CAPTION>
Current
Value of
Assets on
Purchase Selling Cost of Assets Transaction
Description Price Price Sold Date Gain (Loss)
- ------------------------------------- ------------ ----------- ------------ ----------- -----------
<S> <C> <C> <C> <C> <C>
SERIES OF TRANSACTIONS, CONTINUED:
Dreyfus Treasury Fund
Purchases/sales - 22,248,346 (22,248,346) 22,248,346 -
SINGLE TRANSACTIONS:
Fidelity Institutional Cash
Sale - 51,425,447 (51,425,447) 51,425,447 -
Delaware Trend Institutional Fund
Sale - 27,181,908 (27,181,908) 27,181,908 -
Dreyfus Treasury Fund
Sale - 22,145,441 (22,145,441) 22,145,441 -
</TABLE>
<PAGE>
Signature
---------
Pursuant to the requirements of the Securities Exchange Act of 1934, the
trustees have duly caused this annual report to be signed on its behalf by the
undersigned hereunto duly authorized.
HARRAH'S ENTERTAINMENT, INC.
SAVINGS AND RETIREMENT PLAN
By: /s/ Judy T. Wormser
--------------------------
Judy T. Wormser
Authorized Trustee of the
Plan and Vice President and
Controller of Harrah's
Entertainment, Inc.
<PAGE>
Exhibit 23
CONSENT OF INDEPENDENT PUBLIC ACCOUNTANTS
As independent public accountants, we hereby consent to the incorporation of our
report dated June 1, 1999, included in this Form 11-K for the year ended
December 31, 1998, into Harrah's previously filed Registration Statement File
No. 33-59975.
ARTHUR ANDERSEN LLP
Memphis, Tennessee,
June 24, 1999.
