Ceridian Corporation Personal Investment Plan
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SECURITIES AND EXCHANGE COMMISSION

Washington, DC 20549

FORM 11-K

ANNUAL REPORT PURSUANT TO SECTION 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934

For the Fiscal Year Ended December 31, 2001

Commission File Number 1-15168

CERIDIAN CORPORATION PERSONAL INVESTMENT PLAN

(Full title of the Plan)

CERIDIAN CORPORATION
(Delaware Corporation)
3311 East Old Shakopee Road
Minneapolis, MN 55425

(Name and address of principal executive office of the
issuer of the securities held pursuant to the Plan)

IRS Employer Identification Number 41-1981625

 


TABLE OF CONTENTS

Financial Statements
Independent Auditors’ Report
Statements of Net Assets Available for Benefits as of December 31, 2001 and 2000
Statements of Changes in Net Assets Available for Benefits for the Years Ended December 31, 2001 and 2000
Notes to Financial Statements — December 31, 2001 and 2000
Supplemental Schedule
Schedule of Assets (Held at End of Year) — December 31, 2001
Signature
Exhibits
Exhibit Index
EX-23.01 Consent of Independent Auditors
EX-99.01 Personal Investment Plan - 2001 Revision
EX-99.02 Personal Investment Plan-1st Declaration
EX-99.03 Personal Investment Plan-2nd Declaration


Table of Contents

Ceridian Corporation
Personal Investment Plan

Index to Financial Statements, Schedules, and Exhibits

         
      Page Number
     
Financial Statements
       
 
       
Independent Auditors’ Report
    2  
 
       
Statements of Net Assets Available for Benefits as of December 31, 2001 and 2000
    3  
 
       
Statements of Changes in Net Assets Available for Benefits for the Years Ended December 31, 2001 and 2000
    4  
 
       
Notes to Financial Statements — December 31, 2001 and 2000
    5  
 
       
Supplemental Schedule
       
 
       
Schedule of Assets (Held at End of Year) — December 31, 2001
    9  
 
       
Signature
    10  
 
       
Exhibits
       
 
       
Exhibit Index
    11  

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INDEPENDENT AUDITORS’ REPORT

The Board of Directors and
the Retirement Committee of
Ceridian Corporation:

We have audited the accompanying statements of net assets available for benefits of the Ceridian Corporation Personal Investment Plan (the “Plan”) as of December 31, 2001 and 2000, and the related statements of changes in net assets available for benefits for the years then ended. These financial statements are the responsibility of the Plan’s management. Our responsibility is to express an opinion on these financial statements based on our audits.

We conducted our audits in accordance with auditing standards generally accepted in the United States of America. Those standards require that we plan and perform the 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, 2001 and 2000, and the changes in net assets available for benefits for the years then ended, in conformity with accounting principles generally accepted in the United States of America.

Our audits were performed for the purpose of forming an opinion on the financial statements taken as a whole. The supplemental schedule of assets (held at end of year) is presented for the purpose of additional analysis and is not a required part of the basic financial statements, but is 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. This supplemental schedule is the responsibility of the Plan’s management. The supplemental schedule has been subjected to the auditing procedures applied in the audits 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/KPMG LLP

Minneapolis, Minnesota
June 7, 2002

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CERIDIAN CORPORATION PERSONAL INVESTMENT PLAN
Statements of Net Assets Available for Benefits
December 31, 2001 and 2000
(Dollars in thousands)

                       
          2001     2000  
         
   
 
Investments at fair value:
               
 
Ceridian Corporation
               
     
Common Stock
  $ 4,840     $ 6,919  
 
Arbitron Inc.
             
     
Common Stock
    1,543        
 
           
 
Mutual Funds
    99,925       119,127  
 
Loans receivable
               
   
from participants
    1,263       1,446  
 
 
   
 
Total investments
    107,571       127,492  
Cash
    3        
 
 
   
 
Net assets available for benefits
  $ 107,574     $ 127,492  
 
 
   
 

See accompanying notes to financial statements.

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CERIDIAN CORPORATION PERSONAL INVESTMENT PLAN
Statements of Changes in Net Assets Available for Benefits
For the Years Ended December 31, 2001 and 2000
(Dollars in thousands)

                       
          2001     2000  
         
   
 
Additions:
               
 
Additions to net assets attributed to:
               
   
Net appreciation (depreciation) on fair value of
               
     
investments including realized gains (losses)
  $ (5,111 )   $ (7,772 )
   
Interest
    102       100  
   
Dividends
    4,124       10,989  
 
 
   
 
 
    (885 )     3,317  
 
Contributions:
               
   
Participant
    4,456       5,091  
   
Employer
    741       859  
 
 
   
 
 
    5,197       5,950  
 
 
   
 
   
Total additions
    4,312       9,267  
Deductions:
               
 
Benefits paid to participants
    10,632       25,494  
 
 
   
 
Net increase (decrease) before transfers
    (6,320 )     (16,227 )
 
Net transfers (to) from other plans
    (13,598 )     59  
 
 
   
 
Increase (Decrease) in net assets available for benefits
    (19,918 )     (16,168 )
Net assets available for benefits:
               
 
Beginning of year
    127,492       143,660  
 
 
   
 
 
End of year
  $ 107,574     $ 127,492  
 
 
   
 

See accompanying notes to financial statements.

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CERIDIAN CORPORATION PERSONAL INVESTMENT PLAN
Notes to Financial Statements
December 31, 2001 and 2000

(1)   Summary of Significant Accounting Policies

  (a)   Basis of Presentation and Use of Estimates
 
      The accompanying financial statements of the Ceridian Corporation Personal Investment Plan, as amended (the “Plan”), have been prepared on the accrual basis of accounting. The preparation of financial statements in conformity with accounting principles generally accepted in the United States of America requires the Plan administrator to make estimates and assumptions that affect the reported amounts of net assets available for benefits and disclosure of contingent assets and liabilities at the date of the financial statements and the reported changes in net assets available for benefits during the reporting period. Actual results could differ from those estimates.
 
  (b)   Custodian of Investments
 
      Under the terms of a trust agreement between T. Rowe Price Trust Company (the “Trustee”) and Ceridian Corporation (the “Company”), the Trustee holds, manages and invests contributions to the Plan and income therefrom in funds selected by the Company’s Retirement Committee to the extent directed by participants in the Plan. The Trustee carries its own banker’s blanket bond insuring against losses caused, among other things, by dishonesty of employees, burglary, robbery, misplacement, forgery and counterfeit money.
 
  (c)   Investments
 
      Investments are stated at their approximate fair value. Investments in common stock are valued at closing prices published in the Consolidated Transaction Reporting System of the New York Stock Exchange. Investments in mutual funds are valued using daily net asset value calculations performed by the funds and published by the National Association of Securities Dealers. Loans receivable from participants are valued at principal amount which approximates fair value. Net realized gains or losses are recognized by the Plan upon the sale of its investments or portions thereof on the basis of average cost to each investment program. Purchases and sales of securities are recorded on a trade date basis.
 
  (d)   Costs and Expenses
 
      Costs and expenses of administering the Plan are paid by the Company and affiliated companies who have adopted the Plan (“Adopting Affiliates”).

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CERIDIAN CORPORATION PERSONAL INVESTMENT PLAN
Notes to Financial Statements
December 31, 2001 and 2000

(2)   Description of the Plan
 
    The Plan is a defined contribution plan, qualified under Section 401(a) of the Internal Revenue Code of 1986, as amended (the “Code”), which includes provisions under Section 401(k) of the Code allowing an eligible participant to direct the employer to contribute a portion of the participant’s compensation to the Plan on a pre-tax basis through payroll deductions. Only those employees of the Company and Adopting Affiliates who are U.S. citizens or resident aliens paid under the U.S. domestic payroll system and participate in the Company’s qualified defined benefit pension plan are eligible to participate in the Plan. The Plan is administered by the Company through its Director, Executive Compensation and 401(k) Plans and through its Retirement Committee, which is appointed by the Chief Executive Officer of the Company. The Plan is subject to the provisions of the Employee Retirement Income Security Act of 1974, as amended, and the rules and regulations issued thereunder (“ERISA”).
 
(3)   Participant Accounts and Vesting
 
    The Trustee maintains an account for each participant, including participant directed allocations to each investment fund. Each participant’s account is credited with the participant’s contribution and allocations of any employer contribution and Plan earnings, less loans and withdrawals, based on the direction of the participant. Participants are immediately vested in their contributions and employer contributions, plus actual earnings thereon; therefore, there are no forfeitures.
 
(4)   Contributions
 
    Participants may direct their employer to contribute to the Plan on their behalf through payroll deduction from 1% to 17% of their compensation in any pay period, subject to certain limitations. During 2001 and 2000, the Plan administrator, in accordance with the terms of the Plan, limited payroll deduction contributions on behalf of highly compensated participants to 8% of their compensation. For 2001 and 2000, the Code limited the total salary deferral contributions for any participant year to $10,500 and provided that no participant may make annual deferral contributions to the Plan from salary in excess of $170,000. These amounts are subject to periodic adjustment for increases in the cost of living in accordance with Treasury regulations. The Company and Adopting Affiliates made basic monthly matching contributions totaling $741,000 in 2001 and $859,000 in 2000 and did not declare a year-end performance matching contribution for either year.
 
    The basic monthly matching contributions for 2001 and 2000 were determined on the basis of 50% of a participant’s salary deferral contributions, up to a maximum of 3% of eligible compensation, and did not require the satisfaction of performance criteria. The year-end performance-based matching contribution required the achievement of certain Company economic performance criteria. These criteria were not achieved for either 2001 or 2000.

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CERIDIAN CORPORATION PERSONAL INVESTMENT PLAN
Notes to Financial Statements
December 31, 2001 and 2000

(5)   Withdrawals
 
    Participants who are still employed by the Company or one of its Adopting Affiliates may only withdraw from their Plan account for “financial hardship,” as defined by federal regulations, for total disability, or if the participant is 59 1/2 years old. Participants may also withdraw amounts that were rolled into the Plan from another qualified plan or a conduit IRA. Withdrawals are also permitted pursuant to a qualified domestic relations order or in the event of termination of employment, retirement or death.
 
(6)   Loans
 
    Participants may borrow up to 50% of their salary deferral contributions and investment earnings on those contributions. Any loan must be in a multiple of $100, be at least $1,000, and not be more than $50,000 less the amount of the highest loan balance outstanding during the 12-month period that ends the day before the loan is made. Participants may not have more than two loans outstanding. The interest rate is set by the Plan administrator and is based on the prime interest rates charged by major national banks. Each loan is approved by the Plan administrator or a delegate, and the Trustee maintains a loan receivable account for any participant with an outstanding loan.
 
(7)   Income Tax Status
 
    The Plan was amended and restated effective January 1, 2001. The Plan administrator has requested from the Internal Revenue Service, but has yet to receive, a determination regarding the restated Plan’s tax qualified status. The Plan, prior to the amendment and restatement effective January 1, 2001, received a favorable determination letter regarding the Plan’s tax qualification dated September 7, 1995 from the Internal Revenue Service stating that the Plan was qualified under the provisions of Section 401(a) of the Code, and that the trust established thereunder was thereby exempt from federal income taxes under Section 501(a) of the Code. The Company believes the Plan continues to operate in compliance with the applicable requirements of the Code.
 
    Contributions to the Plan will not be included in the participant’s taxable income for federal and, in most states, state income tax purposes until distributed or withdrawn. Each participant’s portion of earnings from the investments made with contributions under the Plan generally is not taxable until distributed or withdrawn.
 
(8)   Party-in-interest
 
    The Trustee is a party-in-interest with respect to the Plan. In the opinion of the Trustee, transactions between the Plan and the Trustee are exempt from being considered as prohibited transactions under Section 408(b) of ERISA.

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CERIDIAN CORPORATION PERSONAL INVESTMENT PLAN
Notes to Financial Statements
December 31, 2001 and 2000

(9)   Investments
 
    The following table presents individual investment programs whose carrying values represent 5% or more of the Plan’s net assets available for plan benefits at the end of each of the respective years (dollars in thousands):
                         
            2001     2000  
           
   
 
Ceridian Corporation Common Stock
  $       NA   $ 6,919  
T. Rowe Price New Horizons Fund
            21,294       27,144  
T. Rowe Price International Stock Fund
          NA     7,465  
T. Rowe Price Equity Index 500 Fund
            7,420       10,990  
T. Rowe Price New Income Fund
            6,249     NA
T. Rowe Price Equity Income Fund
            30,862       36,954  
T. Rowe Price Summit Cash Reserves Fund
            14,087       14,786  

    The following table presents the net appreciation (depreciation) on fair value of investments including realized gains (losses) for each major class of the of the Plan’s investments for each of the respective years (dollars in thousands):
                 
    2001     2000  
   
   
 
Ceridian Corporation Common Stock
  $ 701     $ (365 )
Arbitron Inc. Common Stock
    692     NA
Mutual Funds
    (6,504 )     (7,407 )
 
 
   
 
Total
  $ (5,111 )   $ (7,772 )
 
 
   
 

(10)   Reverse Spin-Off Transaction
 
    On March 30, 2001, Ceridian Corporation (“Old Ceridian”) distributed to its stockholders all of the outstanding common stock of New Ceridian Corporation, a Delaware corporation and wholly owned subsidiary of Old Ceridian (“New Ceridian”), in a reverse spin-off transaction that separated its human resource solutions and Comdata businesses from its media information business. In anticipation of this transaction, the Plan was amended effective as of March 27, 2001, to transfer sponsorship of the Plan from Old Ceridian to New Ceridian. Immediately following the transaction, Old Ceridian, containing only the media information business, was renamed Arbitron Inc. and New Ceridian was renamed Ceridian Corporation.
 
    On April 2, 2001, the account balances under the Plan of each Arbitron Inc. participant and all trust assets in kind related to those balances, amounting to $13,605,000 and including loan balances of $135,000, were transferred to the Arbitron Inc. 401(k) Plan trust. Shares in Arbitron Inc. resulting from the reverse spin-off transaction were placed in the Arbitron Inc. Stock Fund pending redistribution by the participant within one year to other available investment programs within the Plan.

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Schedule 1

CERIDIAN CORPORATION PERSONAL INVESTMENT PLAN
Schedule of Assets (Held at End of Year)
December 31, 2001
(Dollars in thousands)

                                 
            Shares or             Fair Market  
Description           Face Value     Cost     Value  

         
   
   
 
Ceridian Corporation Common Stock
    *       258,112     $ 3,347     $ 4,840  
 
                               
Arbitron Inc. Common Stock
            830,416       830       1,543  
 
                               
Mutual Funds
                               
T. Rowe Price New Horizons Fund
    *       940,952       19,200       21,294  
 
                               
T. Rowe Price International Stock Fund
    *       413,749       5,754       4,547  
 
                               
T. Rowe Price Capital Appreciation Fund
    *       332,548       4,629       4,869  
 
                               
T. Rowe Price Equity Index 500 Fund
    *       240,600       8,166       7,420  
 
                               
T. Rowe Price New Income Fund
    *       719,919       6,277       6,249  
 
                               
T. Rowe Price Balanced Fund
    *       239,148       3,840       4,183  
 
                               
T. Rowe Price Equity Income Fund
    *       1,304,953       27,330       30,862  
 
                               
T. Rowe Price Small-Cap Value Fund
    *       193,385       3,809       4,382  
 
                               
T. Rowe Price Summit Cash Reserves Fund
    *       14,087,259       14,088       14,087  
 
                               
T. Rowe Price International Discovery Fund
    *       18,064       548       347  
 
                               
T. Rowe Price Science & Technology Fund
    *       547,925       1,429       749  
 
                               
Janus Growth and Income Fund
            31,240       1,188       936  
 
                               
Loans Receivable from Participants
(range of interest rates 6.0% to 9.5%)
                    1,263       1,263  
 
                 
   
 
 
                  $ 101,698     $ 107,571  
 
                 
   
 

*   Represents party-in-interest.

See Independent Auditors’ Report

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SIGNATURE

     Pursuant to the requirements of the Securities Exchange Act of 1934, the trustees (or other persons who administer the employee benefit plan) have duly caused this annual report to be signed on its behalf by the undersigned hereunto duly authorized.

             
        CERIDIAN CORPORATION
   PERSONAL INVESTMENT PLAN
   
 
Date: June 25, 2002   By:   Ceridian Corporation
   its Named Fiduciary
   
 
        By:   /s/ J. H. Grierson

John H. Grierson
Vice President and Treasurer

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EXHIBIT INDEX

         
Exhibit   Description   Code
 
23.01   Consent of Independent Auditors   E
 
99.01   Ceridian Corporation Personal Investment Plan - 2001 Revision   E
 
99.02   Ceridian Corporation Personal Investment Plan - First Declaration of Amendment   E
 
99.03   Ceridian Corporation Personal Investment Plan - Second Declaration of Amendment   E

Legend: (E) Electronic Filing

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