Summary Plan Description

Unit Value Accounting

Investment earnings and losses are reflected by the unit value calculated each month based on the investment performance of the plan and number of units in the plan. When contributions are received by the plan, the plan purchases units based on the current investment performance of the plan. A "unit" is an accounting method that allows the plan to provide interest to contributions based on the month the hours were worked instead of the month the contributions were received by the plan. All five subaccounts use the same unit value.

Units purchased is determined by multiplying the contributions received each month by the unit value for that month. For example, 160 hours worked in June 2008 provided $96.00 in employer contributions (160 hours x $.60/hour = $96.00). $96.00 buys or purchases 64.5378 "units" based on the June 2008 unit value of $1.4875 ($96.00 ÷ $1.4875 per unit = 64.5378 units). Those same 64.5378 units were valued at $126.24 on December 31, 2013 based on the December 2013 unit value of $1.9560 (64.5378 x $1.9560 = $126.24, an increase of $30.24 over the original purchase value). The unit value for each month is determined in the same way interest was determined each month under the old accounting method.

In general, when investment performance is high, you purchase fewer units. When investment performance is low, you purchase more units.

Calculations
Example 1

If a participant worked 160 hours in January 2014 and had $96.00 in employer contributions submitted on his or her behalf, those contributions would purchase units as follows:

Total Hours Reported x Hourly Contribution Rate = Total Contributions For That Month
160 Hours x $.60/Hour = $96.00
Contributions ÷ Unit Value = Units Purchased For That Month
$96.00 ÷ $1.9853 = 48.3554 Units

These units are added to the employer contribution subaccount and receive a new unit value each month based on current investment performance.

Example 2

If a participant worked 160 hours in January 2014 and had $640.00 in 401(k) elective contributions submitted on his or her behalf, those contributions would purchase units as follows:
Total Hours Reported x Hourly Contribution Rate = Total Contributions For That Month
160 Hours x $4.00/Hour = $640.00
Contributions ÷ Unit Value = Units Purchased For That Month
$640.00 ÷ $1.9853 = 322.3694 Units

These units are added to the elective contribution subaccount and will receive a new unit value each month based on current investment performance.

Unit value allows the plan to provide participants with the correct units even if an employer submits contributions late.