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, 2003
OR
[ ] TRANSITION REPORT PURSUANT TO SECTION 15(d) OF THE SECURITIES EXCHANGE ACT
OF 1934
For the transition period from ____ to ____
Commission file number 333-82306
A. Full title of the plan and the address of the plan, if different from
that of the issuer named below:
Employees' Thrift Plan of Indianapolis Power & Light Company
B. Name of issuer of the securities held pursuant to the plan and the
address of its principal executive office:
The AES Corporation
1001 North 19th Street
Arlington, VA 22209
REQUIRED INFORMATION
A list of the required financial statements filed as part of this Form 11-K
is set forth on page F-1. The consent of Deloitte & Touche to the incorporation
by reference of these financial statements into the AES Corporation's Form S-8
Registration Statement relating to the Plan (Registration No. 333-82306) is set
forth hereto as Exhibit 23. The certification of the chief executive officer and
the chief financial officer of Indianapolis Power & Light Company, pursuant to
18 U.S.C. ss.1350, is attached hereto as Exhibit 99.
EMPLOYEES' THRIFT PLAN OF
INDIANAPOLIS POWER & LIGHT COMPANY
TABLE OF CONTENTS
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Page
REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM 1
FINANCIAL STATEMENTS:
Statements of Assets Available for Benefits as of December 31, 2003 and 2002 2
Statement of Changes in Assets Available for Benefits for the Year Ended
December 31, 2003 3
Notes to Financial Statements 4-7
SUPPLEMENTAL SCHEDULE: 8
Form 5500, Schedule H, Part IV, Line 4i--Schedule of Assets (Held at End of Year)
As of December 31, 2003 9
NOTE: Schedules not filed herewith are omitted because of the absence of the
conditions under which they are required by Department of Labor's
Rules and Regulations for Reporting and Disclosure under the Employees
Retirement Income Security Act of 1974.
REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM
Employees' Pension Committee of the Employees' Thrift Plan
of Indianapolis Power & Light Company
We have audited the accompanying statements of assets available for benefits of
the Employees' Thrift Plan of Indianapolis Power & Light Company (the "Plan") as
of December 31, 2003 and 2002, and the related statement of changes in assets
available for benefits for the year ended December 31, 2003. 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 standards of the Public Company
Accounting Oversight Board (United States). 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, such financial statements present fairly, in all material
respects, the assets available for benefits of the Plan at December 31, 2003 and
2002, and the changes in assets available for benefits for the year ended
December 31, 2003, in conformity with accounting principles generally accepted
in the United States of America.
Our audits were conducted for the purpose of forming an opinion on the basic
financial statements taken as a whole. The supplemental schedule listed in the
Table of Contents 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 schedule is the responsibility of the Plan's management. This
schedule has been subjected to the auditing procedures applied in our audit of
the basic 2003 financial statements and, in our opinion, is fairly stated in all
material respects when considered in relation to the basic 2003 financial
statements taken as a whole.
/s/ DELOITTE & TOUCHE LLP
Indianapolis, Indiana
June 16, 2004
EMPLOYEES' THRIFT PLAN OF
INDIANAPOLIS POWER & LIGHT COMPANY
STATEMENTS OF ASSETS AVAILABLE FOR BENEFITS
DECEMBER 31, 2003 AND 2002
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ASSETS 2003 2002
INVESTMENTS--at fair value:
The AES Corporation Common Stock $26,103,606 $ 8,065,808
Merrill Lynch Equity Index Trust--
Common/Collective Trust 5,061,663 4,181,345
Merrill Lynch Retirement Preservation Trust--
Common/Collective Trust 6,165,445 4,215,854
Aim Income Mutual Fund 522,737 485,582
Alliance Technology Mutual Fund 1,130,463 1,134,435
Ivy International Mutual Fund 643,129 538,193
Merrill Lynch Balanced Capital Fund 2,452,516 2,094,130
Merrill Lynch Federal Securities Trust Mutual Fund 10,064,764 10,364,771
Oppenheimer Main Street Income & Growth Mutual Fund 8,021,811 6,344,482
Alger Midcap Growth Institutional Portfolio Mutual Fund 282,383
Templeton Foreign Mutual Fund 680,638
Van Kampen Growth & Income Mutual Fund 813,480
Lord Abbett Small Cap Value Mutual Fund 238,786
JP Morgan Mid-Cap Value Mutual Fund 244,140
Federated Total Return Bond Mutual Fund 549,830
Seligman Henderson Global Technology Mutual Fund 148,880
Phoenix Duff & Phelps Real Estate Securities Mutual Fund 112,375
Oppenheimer Real Asset Mutual Fund 8,942
Franklin Mutual Financial Services Mutual Fund 32,931
Oppenheimer Gold & Special Minerals Mutual Fund 44,404
Delaware Investments Trend Mutual Fund 83,115
Aim Global Health Care Mutual Fund 36,339
Merrill Lynch Utility and Telecommunications Mutual Fund 6,510
American Growth Fund of America Mutual Fund 653,311
Participant loans 601,673
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Total investments 64,703,871 37,424,600
CASH 96,763 3,312
CONTRIBUTIONS RECEIVABLE 259,282 222,033
ACCRUED INTEREST AND DIVIDENDS 89,161 88,240
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ASSETS AVAILABLE FOR BENEFITS $65,149,077 $37,738,185
=========== ===========
See notes to financial statements.
EMPLOYEES' THRIFT PLAN OF
INDIANAPOLIS POWER & LIGHT COMPANY
STATEMENT OF CHANGES IN ASSETS AVAILABLE FOR BENEFITS
YEAR ENDED DECEMBER 31, 2003
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INCREASES:
Employee contributions $ 4,299,503
Company contributions--net 2,104,579
Interest and dividend income 750,293
Net appreciation in fair value of investments 21,896,725
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Total 29,051,100
-----------
DECREASES:
Withdrawals by participants or their beneficiaries 1,626,006
Administrative fees 14,202
-----------
Total 1,640,208
-----------
INCREASE IN ASSETS AVAILABLE FOR BENEFITS 27,410,892
ASSETS AVAILABLE FOR BENEFITS--Beginning of year 37,738,185
-----------
ASSETS AVAILABLE FOR BENEFITS--End of year $65,149,077
===========
See notes to financial statements.
EMPLOYEES' THRIFT PLAN OF
INDIANAPOLIS POWER & LIGHT COMPANY
NOTES TO FINANCIAL STATEMENTS
YEARS ENDED DECEMBER 31, 2003 AND 2002
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1. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
Basis of Accounting--The financial statements of the Employees' Thrift Plan
of Indianapolis Power & Light Company (the "Plan") have been prepared on
the accrual basis.
Plan Assets--Assets of the Plan are maintained in trust. Once placed in
trust, assets may be withdrawn only for the purpose of refunding employee
contributions, payment of vested employer contributions to employees
withdrawing from the Plan, to employees obtaining an in-service
(suspension) withdrawal, to retiring employees, to participants electing a
loan from the Plan, and to beneficiaries of deceased employees; or to pay
expenses of the Plan. Participants make requests for distributions directly
with the recordkeeper, Merrill Lynch Trust Company of America ("Merrill
Lynch"), except for hardship withdrawals and refunds of participant
contributions, which require approval from the Payroll & Benefits
department of the Indianapolis Power & Light Company ("IPL"). The Payroll &
Benefits department of IPL conducts day-to-day activities of the Plan at
the designation of the Employees' Pension & Benefit Committee (the "Pension
Committee").
Merrill Lynch is the sole trustee and recordkeeper of the assets of the
Plan.
Investments--Investments in securities are stated at fair value as
determined by quoted market prices. Investment transactions are recorded as
of the trade date. The cost of the securities sold is determined on a
specific identification basis.
Participant Loans--Loans to participants are stated at cost which
approximates fair value.
Use of Management Estimates--The preparation of financial statements in
conformity with accounting principles generally accepted in the United
States of America requires that management make certain 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. The reported amounts of increases and decreases in
assets during the reporting period may also be affected by the estimates
and assumptions management is required to make. Actual results may differ
from those estimates.
Administrative Fees--The Trustee assesses each participant $1.88 on a
quarterly basis for the base service fee. Participants pay a commission of
$0.08 per share for open market transactions in The AES Corporation ("AES")
common stock. The commission is reflected in the price per share for each
transaction. There are no other transaction-based fees for the investment
funds.
Expenses for postage and handling for participant statements, confirmations
and distributions are charged directly to participants. It is estimated
that these expenses will be approximately $3.00 per participant per plan
year.
Payment of Benefits--Upon severance of employment, a participant may elect
to receive a lump sum payment for the full value of the participant's
account, including vested employer contributions and related earnings. The
participant also has the option of maintaining the account until reaching
the age of 70 1/2 years. Benefits are recorded when paid.
2. DESCRIPTION OF THE PLAN
The Plan is administered by the Pension Committee which is a committee of
not less than five persons appointed by the IPL Board of Directors. The
Plan is a defined contribution plan, and certain employees become eligible
to participate in the Plan immediately upon date of employment.
All employees become fully vested in the Plan after five years of
uninterrupted service. Termination of employment before the five-year
requirement requires forfeiture of a prorated amount of allocated employer
contributions. Forfeited amounts may be used to reduce employer matching
contributions. As of December 31, 2003, there is currently $17,921 in the
forfeiture fund.
The Plan is valued on a daily "share" valuation.
Employee contributions are made through payroll deductions representing
amounts equal to a specific percentage of the employee's base rate of
compensation. Employees have the option of contributing anywhere from 1% to
50%, in increments of 1%, and direct their contributions into any of
twenty-one options. Employees can make such contributions under a "Before
Tax" or "After Tax" option. Employer contributions are made in an amount
equal to current employee contributions up to a maximum of 4% and are
invested in the same funds as the employee elects to have his/her
contributions invested. Prior to February 9, 2002, employer contributions
were made directly into the common stock of AES and were not transferable
to any of the other funds. Effective February 9, 2002, participants were
allowed to transfer employer contributions out of the AES common stock fund
to any of the available investment options in accordance with the Plan's
procedures. Effective January 1, 2003, participant contributions are made
into the same funds as the participant elects to have his/her contributions
made into. Each participant's account is credited with the participant's
contribution and IPL's matching contribution. Allocations of Plan earnings
are based on individual account balances relative to total account balances
as of the valuation dates.
Participant fund transfers are subject to certain restrictions as outlined
in the Summary Plan Description. In the event of partial or total
termination of the Plan, the funds in the Plan shall be valued as of the
date of partial or total termination and, after payment of necessary
expenses, shall be distributed as though all participants directly affected
by the partial or total termination had retired as of that date.
Participants may borrow up to the lesser of 50% of the vested portion of
their account or $50,000, with a minimum loan requirement of $1,000. The
period of repayment of the loan can vary but generally will not exceed five
years except for loans used to purchase or construct a principal residence.
The loans are secured by the balance in the participant's account and bear
interest at one percent over prime. Principal and interest are paid through
payroll deductions.
The Plan is maintained with the intent of being a qualified trust under
Section 401(a) of the Internal Revenue Code. Its related trust is exempt
from Federal income taxes under Section 501(a) of the Code. The Plan
obtained its latest determination letter on February 6, 2003 in which the
Internal Revenue Service stated that the Plan, as then designed, was in
compliance with the applicable requirements of the Internal Revenue Code.
The Plan has been amended since receiving the determination letter.
However, the Plan administrator and the Plan's tax counsel believe that the
Plan, as amended, is being operated in compliance with the applicable
requirements of the Internal Revenue Code.
Although it has not expressed any intent to do so, IPL 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 would become 100 percent vested in their employer
contributions.
Participants should refer to the Summary Plan Description for a more
detailed description of the Plan.
On June 21, 2001, the Plan was amended to no longer allow non-union
employees to make contributions to or participate in the Plan effective
July 7, 2001. Effective January 1, 2003, all non-union employees, who were
hired prior to July 1, 2001, were given a choice to make a one-time
irrevocable election to rejoin the plan.
3. RISKS AND UNCERTAINTIES
The Plan invests in various securities including U.S. Government
securities, corporate debt instruments, corporate stocks, registered
investment companies, and common/collective trusts. Investment securities,
in general, are exposed to various risks, such as interest rate, credit,
and overall market volatility. Due to the level of risk associated with
certain investment securities, it is reasonably possible that changes in
the values of investment securities will occur in the near term and that
such changes could materially affect the amounts reported in the statements
of net assets available for benefits.
4. INVESTMENTS
The following presents investments that represent 5 percent or more of the
Plan's assets.
2003 2002
The AES Corporation common stock, 2,765,212 and
2,670,797 shares, respectively $26,103,606 $ 8,065,808*
Oppenheimer Main Street Income & Growth
Mutual Fund, 244,567 and 244,019 shares, respectively $ 8,021,811 $ 6,344,482
Merrill Lynch Federal Securities Trust Mutual Fund,
980,971 and 1,001,427 shares, respectively $10,064,764 $10,364,771
Merrill Lynch Retirement Preservation Trust,
6,165,445 and 4,215,854 shares, respectively $ 6,165,445 $ 4,215,854
Merrill Lynch Equity Index Trust,
62,972 and 66,741 shares, respectively $ 5,061,663 $ 4,181,345
Merrill Lynch Balanced Capital Fund
92,828 and 94,076 shares, respectively** $ 2,452,516 $ 2,094,130
* Includes nonparticipant-directed investments (see Note 2)
** 2002 value is over 5%, 2003 value is under 5%
During 2003, the Plan's investments (including both realized and unrealized
gains and losses) appreciated in value by $21,896,725 as follows:
Mutual Funds $ 2,931,347
Common/Collective Trust 1,177,032
The AES Corporation Common Stock 17,788,346
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Net appreciation in fair value of investments $21,896,725
===========
5. MERRILL LYNCH RETIREMENT PRESERVATION TRUST
One of the investment funds is the Merrill Lynch Retirement Preservation
Trust, which is a trust for the collective investment of Qualified Plans.
The majority of the fund assets consist of investment contracts which are
included in the financial statements at contract value, (which represents
contributions made under the contracts, plus earnings, less withdrawals and
administrative expenses) because they are fully benefit responsive. For
example, participants may ordinarily direct the withdrawal or transfer of
all or a portion of their investment at contract value. There are no
reserves against contract value for credit risk of the contract issuer or
otherwise. The contract value of the investment contracts at December 31,
2003 and 2002 approximates market value. The average yield rates for 2003
and 2002 were approximately 4.26% and 5.47%, respectively.
6. RELATED PARTY TRANSACTIONS
Merrill Lynch, the Plan Trustee, invests in AES common stock. Since AES is
the parent company of IPALCO Enterprises, Inc. and IPALCO Enterprises, Inc.
is the parent company of IPL, any investment transactions involving AES
common stock qualify as related-party transactions. Merrill Lynch is also
the Investment Manager for the Merrill Lynch Retirement Preservation Trust,
the Merrill Lynch Equity Index Trust, the Merrill Lynch Balanced Capital
Fund, the Merrill Lynch Utility and Telecommunications Mutual Fund and the
Merrill Lynch Federal Securities Trust.
******
SUPPLEMENTAL SCHEDULE
EMPLOYEES' THRIFT PLAN OF
INDIANAPOLIS POWER & LIGHT COMPANY
FORM 5500, SCHEDULE H, PART IV, LINE 4i--
SCHEDULE OF ASSETS (HELD AT END OF YEAR)
EIN: 35-0413620
PN: 003
DECEMBER 31, 2003
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Fair
Shares Description Cost Value
78,254 Aim Income Mutual Fund $ 538,083 $ 522,737
1,389 Aim Global Health Care Mutual Fund 33,553 36,339
20,807 Alliance Technology Mutual Fund 1,968,360 1,130,463
2,765,212 * The AES Corporation Common Stock 51,206,339 26,103,606
31,159 Ivy International Mutual Fund 859,780 643,129
6,165,445 * Merrill Lynch Retirement Preservation Trust
Common/Collective Trust 6,165,445 6,165,445
62,972 * Merrill Lynch Equity Index Trust
Common/Collective Trust 4,931,739 5,061,663
244,567 Oppenheimer Main Street Income & Growth Mutual Fund 8,449,690 8,021,811
980,971 * Merrill Lynch Federal Securities Trust Mutual Fund 9,639,115 10,064,764
92,828 * Merrill Lynch Balanced Capital Fund 2,715,500 2,452,516
63,970 Templeton Foreign Mutual Fund 594,967 680,638
45,093 Van Kampen Growth & Income Mutual Fund 726,737 813,480
18,481 Alger Midcap Growth Institutional Portfolio Mutual Fund 250,713 282,383
9,683 Lord Abbett Small Cap Value Mutual Fund 221,369 238,786
13,112 JP Morgan Mid-Cap Value Mutual Fund 218,455 244,140
50,722 Federated Total Return Bond Mutual Fund 551,717 549,830
26,841 American Growth Fund of America Mutual Fund 583,284 653,311
12,314 Seligman Henderson Global Technology Mutual Fund 126,685 148,880
5,511 Phoenix Duff & Phelps Real Estate Securities Mutual Fund 101,640 112,375
1,146 Oppenheimer Real Asset Mutual Fund 8,376 8,942
1,640 Franklin Mutual Financial Services Mutual Fund 30,557 32,931
2,123 Oppenheimer Gold & Special Minerals Mutual Fund 40,773 44,404
4,407 Delaware Investments Trend Mutual Fund 74,510 83,115
747 * Merrill Lynch Utility and Telecommunications Mutual Fund 6,129 6,510
Participant Loans 601,673 601,673
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TOTAL INVESTMENTS $90,645,189 $64,703,871
=========== ===========
* Party-in-interest transaction
SIGNATURES
The Plan. Pursuant to the requirements of the Securities Exchange Act of
1934, the trustees (or other persons who administer the employee benefit plan)
have duly caused this annual report to be signed on its behalf by the
undersigned hereunto duly authorized.
EMPLOYEES' THRIFT PLAN OF INDIANAPOLIS POWER &
LIGHT COMPANY
By the Plan Administrator:
EMPLOYEES' PENSION COMMITTEE OF INDIANAPOLIS
POWER & LIGHT COMPANY
By: /s/ Edward J. Kunz
--------------------------------------------
Edward J. Kunz, Chairman of the Committee
DATE: June 25, 2004