e11vk
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 11-K
(Mark One)
|
|
|
þ |
|
ANNUAL REPORT PURSUANT TO SECTION 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 |
For the fiscal year ended December 31, 2007
OR
|
|
|
o |
|
TRANSITION REPORT PURSUANT TO SECTION 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 |
For the transition period from to
Commission File Number: 333-17007
A. |
|
Full title of the Plan and the address of the Plan, if different from that of the issuer
named below: |
Farm Bureau 401(k) Savings Plan
B. |
|
Name of the issuer of the securities held pursuant to the Plan and the address of its
principal executive office: |
FBL Financial Group, Inc.
5400 University Avenue
West Des Moines, Iowa 50266
INFORMATION PROVIDED
1. |
|
Financial statements and schedule of the Farm Bureau 401(k) Savings Plan prepared in
accordance with financial reporting requirements of Employee Retirement Income Security Act of
1974 are incorporated herein by reference and are attached hereto as Exhibit 1. |
|
2. |
|
A written consent of Independent Auditors is attached hereto
as Exhibit 23.2 and is incorporated
herein by this reference. |
|
3. |
|
A certification pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the
Sarbanes-Oxley Act of 2002 is attached hereto as Exhibit 32 and is incorporated herein by this
reference. |
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.
Date: June 25, 2008
|
|
|
|
|
FARM BUREAU 401(k) SAVINGS PLAN |
|
|
|
|
|
By: Iowa Farm Bureau Federation |
|
|
(Administrator of the Plan) |
|
|
|
|
|
By /s/ Craig A. Lang |
|
|
|
|
|
Craig A. Lang |
|
|
President |
|
|
|
|
|
By /s/ Dennis J. Presnall |
|
|
|
|
|
Dennis J. Presnall |
|
|
Secretary and Treasurer |
EXHIBIT 1
Financial Statements and Supplemental Schedule
Farm Bureau 401(k) Savings Plan
Years Ended December 31, 2007 and 2006
With Report of Independent Registered Public Accounting Firm
Farm Bureau 401(k) Savings Plan
Financial Statements and Supplemental Schedule
Years Ended December 31, 2007 and 2006
Contents
Report of Independent Registered Public Accounting Firm
The Board of Directors
Iowa Farm Bureau Federation
We have audited the accompanying statements of net assets available for benefits of the Farm Bureau
401(k) Savings Plan (the Plan) as of December 31, 2007 and 2006, 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 Plans management. Our responsibility is to express an opinion on
these financial statements based on our audits.
We conducted our audits in accordance with the 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. We
were not engaged to perform an audit of the Plans internal control over financial reporting. Our
audits included consideration of internal control over financial reporting as a basis for designing
audit procedures that are appropriate in the circumstances, but not for the purpose of expressing
an opinion on the effectiveness of the Plans internal control over financial reporting.
Accordingly, we express no such opinion. An audit also includes examining, on a test basis,
evidence supporting the amounts and disclosures in the financial statements, assessing the
accounting principles used and significant estimates made by management, and 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 at December 31, 2007 and 2006, and the
changes in its net assets available for benefits for the years then ended, in conformity with U.S.
generally accepted accounting principles.
Our audits were performed for the purpose of forming an opinion on the financial statements taken
as a whole. The accompanying supplemental schedule of assets (held at end of year) as of December
31, 2007, is presented for the purpose of additional analysis and is not a required part of the
financial statements but is supplementary information required by the Department of Labors Rules
and Regulations for Reporting and Disclosure under the Employee Retirement Income Security Act of
1974. This supplemental schedule is the responsibility of the Plans management. This supplemental
schedule has been subjected to the auditing procedures applied in our audits of the financial
statements and, in our opinion, is fairly stated in all material respects in relation to the
financial statements taken as a whole.
/s/ Ernst & Young LLP
Des Moines, Iowa
June 25, 2008
1
Farm Bureau 401(k) Savings Plan
Statements of Net Assets Available for Benefits
|
|
|
|
|
|
|
|
|
|
|
December 31 |
|
|
2007 |
|
2006 |
|
|
|
Assets |
|
|
|
|
|
|
|
|
Investments: |
|
|
|
|
|
|
|
|
Mutual funds, at fair value |
|
$ |
82,602,826 |
|
|
$ |
76,416,398 |
|
Pooled investment trust, at fair value |
|
|
24,746,210 |
|
|
|
25,699,478 |
|
Group flexible premium deferred annuity, at fair value |
|
|
15,578,781 |
|
|
|
15,544,780 |
|
Notes receivable from participants |
|
|
2,934,356 |
|
|
|
2,524,568 |
|
|
|
|
Total investments |
|
|
125,862,173 |
|
|
|
120,185,224 |
|
|
|
|
|
|
|
|
|
|
Contribution receivables: |
|
|
|
|
|
|
|
|
Employer |
|
|
18,327 |
|
|
|
113,624 |
|
Participants |
|
|
11,641 |
|
|
|
2,863 |
|
|
|
|
Total contribution receivables |
|
|
29,968 |
|
|
|
116,487 |
|
|
|
|
|
|
|
|
|
|
Amount receivable from pending investment trades |
|
|
31,189 |
|
|
|
|
|
Accrued investment income receivable |
|
|
489,273 |
|
|
|
410,167 |
|
|
|
|
Total assets |
|
|
126,412,603 |
|
|
|
120,711,878 |
|
|
|
|
|
|
|
|
|
|
Liabilities |
|
|
|
|
|
|
|
|
Amounts payable for pending investment trades |
|
|
|
|
|
|
585,837 |
|
|
|
|
Net assets available for benefits |
|
$ |
126,412,603 |
|
|
$ |
120,126,041 |
|
|
|
|
See accompanying notes.
2
Farm Bureau 401(k) Savings Plan
Statements of Changes in Net Assets Available for Benefits
|
|
|
|
|
|
|
|
|
|
|
Year Ended December 31 |
|
|
2007 |
|
2006 |
|
|
|
Additions: |
|
|
|
|
|
|
|
|
Investment income: |
|
|
|
|
|
|
|
|
Interest |
|
$ |
871,895 |
|
|
$ |
790,401 |
|
Dividends |
|
|
1,835,444 |
|
|
|
1,447,414 |
|
Net unrealized and realized gains on investments |
|
|
253,853 |
|
|
|
10,785,269 |
|
|
|
|
|
|
|
2,961,192 |
|
|
|
13,023,084 |
|
|
|
|
|
|
|
|
|
|
Contributions: |
|
|
|
|
|
|
|
|
Employees |
|
|
9,719,847 |
|
|
|
9,078,121 |
|
Employer |
|
|
3,997,611 |
|
|
|
3,817,700 |
|
Rollovers from other plans |
|
|
331,896 |
|
|
|
353,400 |
|
|
|
|
Total additions |
|
|
17,010,546 |
|
|
|
26,272,305 |
|
|
|
|
|
|
|
|
|
|
Deductions: |
|
|
|
|
|
|
|
|
Benefits paid to participants |
|
|
(10,708,671 |
) |
|
|
(8,153,717 |
) |
Administrative expenses |
|
|
(15,313 |
) |
|
|
(12,229 |
) |
|
|
|
Total deductions |
|
|
(10,723,984 |
) |
|
|
(8,165,946 |
) |
|
|
|
Net additions |
|
|
6,286,562 |
|
|
|
18,106,359 |
|
|
|
|
|
|
|
|
|
|
Net assets available for benefits at beginning of year |
|
|
120,126,041 |
|
|
|
102,019,682 |
|
|
|
|
Net assets available for benefits at end of year |
|
$ |
126,412,603 |
|
|
$ |
120,126,041 |
|
|
|
|
See accompanying notes.
3
Farm Bureau 401(k) Savings Plan
Notes to Financial Statements
December 31, 2007
1. Description of the Plan
Farm Bureau 401(k) Savings Plan (the Plan) is a defined contribution plan which is designed to
provide retirement benefits. The Plan covers substantially all employees of the Iowa Farm Bureau
Federation and affiliated companies, FBL Financial Group, Inc., Farm Bureau Mutual Insurance
Company, the Arizona Farm Bureau Federation, the New Mexico Farm and Livestock Bureau, the
Minnesota Farm Bureau Federation, the South Dakota Farm Bureau Federation, the Utah Farm Bureau
Federation, the Kansas Farm Bureau and its affiliated company, and the Nebraska Farm Bureau
Federation and its affiliated company (collectively, the Companies). Participants may contribute a
portion of their compensation, pretax, to the Plan. The maximum amount contributed is determined by
each participating company, currently set at 50% for all of the Companies, and additional limits
are imposed by the Internal Revenue Service. Certain participating companies match employee
contributions up to 4% of eligible compensation. Certain participating companies make nonelective
contributions from 5% to 15% of eligible compensation. Beginning in 2007, the Iowa Farm Bureau
Federation and affiliated companies and FBL Financial Group, Inc. adopted automatic enrollment for
their employees. All of their eligible employees who were not deferring a portion of their
compensation to the Plan and had not previously made a formal election not to defer a portion of
their compensation were automatically enrolled in the Plan. Newly hired employees are also
automatically enrolled. All automatically enrolled employees are given the opportunity to opt out
of deferring a portion of their compensation or change the amount that is deferred.
Employer-matching contributions for certain participating companies are invested in FBL Financial
Group, Inc. common stock through ownership of units of a pooled investment trust. Participants own
units of this trust rather than directly owning the stock. Participants are immediately fully
vested in such contributions.
The Plan also allows for participants to borrow money from the Plan subject to certain provisions.
On termination of service, the participant may elect to receive either a lump-sum amount equal to
the value of the account or equal installment payments over a period of time not to exceed the life
expectancy of the participant. In the event the participants vested balance at termination is
$5,000 or less, the balance will be distributed in a lump sum. The participant may elect to receive
the distribution directly or to have the amount paid directly to an eligible retirement plan. If
such an election is not made by the participant and the participants balance is $1,000 or less,
then the
4
Farm Bureau 401(k) Savings Plan
Notes to Financial Statements (continued)
1. Description of the Plan (continued)
amount will be distributed directly to the participant. If such an election is not made by the
participant and the participants balance is greater than $1,000 but does not exceed $5,000, then
the amount will be distributed in a direct rollover to an individual retirement plan designated by
the plan administrator. Balances in excess of $5,000 will remain in the Plan until the participant
provides a distribution election.
Wells
Fargo Bank N.A. is the Plans trustee and provides recordkeeping services to the Plan.
Although they have not expressed intent to do so, the Companies have the right under the Plan to
discontinue their contributions at any time and to terminate the Plan subject to the provisions of
the Employee Retirement Income Security Act of 1974 (ERISA), as amended.
The foregoing description of the Plan provides only general information. A more complete
description of the Plans provisions may be obtained from the plan administrator.
Effective January 1, 2008, the Plan was amended to add Crop1 Insurance Direct, Inc. (Crop1) as a
participating employer. Assets totaling $647,847 were transferred from the Crop1 plan into the
Plan.
2. Significant Accounting Policies
Accounting Changes
In September 2006, the Financial Accounting Standards Board (FASB) issued Statement of Financial
Accounting Standards (SFAS) No. 157, Fair Value Measurements, which defines fair value, establishes
a framework for measuring fair value, and expands the required disclosures about fair value
measurements. This statement is effective for fiscal years beginning after November 15, 2007. The
Plan is currently evaluating the requirements of this statement and have not yet determined the
impact of adoption on the financial statements.
Investments
Investments in mutual funds are stated at fair market value, based on the latest quoted market
price. The pooled investment trust is stated at fair market value, based on the latest quoted
market price of the investments (principally common stock of FBL Financial Group, Inc.) held within
the fund.
5
Farm Bureau 401(k) Savings Plan
Notes to Financial Statements (continued)
2. Significant Accounting Policies (continued)
Investment in the group flexible premium deferred annuity, which is considered a fully
benefit-responsive contract, is carried at fair value as required by FASB Staff Position (FSP) AAG
INV-1 and SOP 94-4-1, Reporting of Fully Benefit-Responsive Investment Contracts Held by Certain
Investment Companies Subject to the AICPA Investment Company Guide and Defined-Contribution Health
and Welfare and Pension Plans. The contract value of this contract is equivalent to its fair market
value as the interest-crediting rate is periodically reset to market at the discretion of the
issuer.
Notes receivable from participants are stated at the unpaid principal balance plus accrued
interest, which approximates fair value. The interest rate used is the Wells Fargo prime lending
rate at the origination of the loan. Interest rates on loans outstanding at year-end ranged from
4.00% to 8.25% at December 31, 2007, and from 4.00% to 10.25% at December, 31 2006.
The Plan invests in various investment securities. Investment securities are exposed to various
risks such as interest rate, market, and credit risks. Due to the level of risk associated with
certain investment securities, it is at least reasonably possible that changes in the values of
investment securities will occur in the near term and that such change could materially affect the
amounts reported in the statements of net assets available for benefits.
Use of Estimates
The preparation of financial statements in conformity with U.S. generally accepted accounting
principles requires management to make estimates and assumptions that affect the amounts reported
in the financial statements and accompanying notes. Actual results could differ from those
estimates.
6
Farm Bureau 401(k) Savings Plan
Notes to Financial Statements (continued)
3. Investments
Contributions are invested in affiliated and unaffiliated mutual funds, a group flexible premium
deferred annuity sponsored by or offered by the Companies and, as discussed above, a pooled
investment trust which invests primarily in the common stock of FBL Financial Group, Inc. All
investments are considered participant directed, as participants may select the investments in
which to invest their contributions. The mutual funds invest primarily in common stocks, fixed
income, high-quality corporate bonds, debt securities of the U.S. Government, and short-term money
market instruments. Participants who elect to purchase units in the pooled investment trust do so
at the market price of the units when the trade is executed. Participants electing to have
contributions deposited into the group flexible premium deferred annuity receive interest at a rate
determined by management of Farm Bureau Life Insurance Company, with a guaranteed minimum rate of
3%. These rates vary based upon the investment experience of the general account of Farm Bureau
Life Insurance Company. The average yield earned by the group flexible premium deferred annuity was
4.16% during 2007 and 4.00% during 2006. The average yield credited to participants with
investments in this contract was 4.15% during 2007 and 4.00% during 2006.
During 2007 and 2006, the Plans investments (including investments purchased, sold, and held
during the year) increased (decreased) in fair value as follows:
|
|
|
|
|
|
|
|
|
|
|
Year Ended December 31 |
|
|
2007 |
|
2006 |
|
|
|
Mutual funds |
|
$ |
5,303,307 |
|
|
$ |
7,389,562 |
|
Pooled investment trust |
|
|
(5,049,454 |
) |
|
|
3,395,707 |
|
|
|
|
|
|
$ |
253,853 |
|
|
$ |
10,785,269 |
|
|
|
|
7
Farm Bureau 401(k) Savings Plan
Notes to Financial Statements (continued)
3. Investments (continued)
The fair values of individual investments that represent 5% or more of the Plans net assets are as
follows:
|
|
|
|
|
|
|
|
|
|
|
December 31 |
|
|
2007 |
|
2006 |
|
|
|
EquiTrust Series Fund, Inc.: |
|
|
|
|
|
|
|
|
Managed Portfolio (440,471 shares in 2007 and
465,638 shares in 2006) |
|
$ |
6,633,489 |
|
|
$ |
7,156,861 |
|
Blue Chip Portfolio (234,738 shares in 2007 and
249,936 shares in 2006) |
|
|
10,966,943 |
|
|
|
11,484,568 |
|
Value Growth Portfolio (389,219 shares in 2007
and 390,333 shares in 2006) |
|
|
6,060,146 |
|
|
|
6,015,026 |
|
American Century Investments Small Cap Value Fund
(854,996 shares in 2007 and 731,491 shares in
2006) |
|
|
6,472,322 |
|
|
|
7,124,724 |
|
American Funds Euro Pacific Growth Fund (224,081
shares in 2007 and 193,082 shares in 2006) |
|
|
11,239,889 |
|
|
|
8,877,890 |
|
American Funds Growth Fund of America Fund
(262,004 shares in 2007 and 217,582 shares in
2006) |
|
|
8,845,259 |
|
|
|
7,106,232 |
|
Vanguard Explorer Fund (97,731 shares in 2007 and
94,994 shares in 2006) |
|
|
6,957,479 |
|
|
|
7,097,008 |
|
Wells Fargo Bank, N.A. S&P MidCap Index Fund
(128,814 shares in 2007 and 132,818 shares in
2006) |
|
|
8,590,604 |
|
|
|
8,226,728 |
|
FBL Financial Group, Inc. common stock*
(699,961 shares in 2007 and 641,757 shares in 2006) |
|
|
24,169,653 |
|
|
|
25,079,863 |
|
Group flexible premium deferred annuity |
|
|
15,578,781 |
|
|
|
15,544,780 |
|
|
|
|
* |
|
The FBL Financial Group, Inc. common stock is owned indirectly through investment in a pooled
investment trust. |
On January 9, 2007, Wells Fargo Advantage Dow Jones Target Date Fund Today, Wells Fargo Advantage
Dow Jones Target Date Fund 2010, Wells Fargo Advantage Dow Jones Target Date Fund 2020, Wells Fargo
Advantage Dow Jones Target Date Fund 2030, and Wells Fargo Advantage Dow Jones Target Date Fund
2040 were added to the Plans investment options. On September 24, 2007, the Wells Fargo Advantage
Dow Jones Target Date Fund 2050 was also added as an investment option.
8
Farm Bureau 401(k) Savings Plan
Notes to Financial Statements (continued)
3. Investments (continued)
On November 20, 2006, Fidelity Advisor Mid Cap Fund and Wells Fargo Advantage Large Company Growth
Fund were eliminated from the Plan as investment options. Three new funds were added: American
Funds Growth Fund of America Fund, Wells Fargo Bank, N.A. S&P MidCap Index Fund, and Vanguard S&P
500 Index Fund. Any amounts in the Fidelity Advisor Mid Cap Fund and the Wells Fargo Advantage
Large Company Growth Fund as of
November 20, 2006, were transferred to the Wells Fargo Bank, N.A. S&P MidCap Index Fund and
American Funds Growth Fund of America Fund, respectively.
The Plan had open investment trades totaling $31,189 at December 31, 2007, and ($585,837) at
December 31, 2006, which were settled during January of the next year. The receivable (payable) for
pending investment trades has been reflected in the statements of net assets available for
benefits.
4. Income Tax Status
The Plan has received a determination letter from the Internal Revenue Service dated
November 6, 2002, stating that the Plan is qualified under Section 401(a) of the Internal Revenue
Code (the Code), and therefore, the related trust is exempt from taxation. Once qualified, the Plan
is required to operate in conformity with the Code to maintain its qualification. The Plan was
amended subsequent to the IRS determination letter. The plan administrator believes the Plan is
being operated in compliance with the applicable requirements of the Code and, therefore, believes
that the Plan is qualified and the related trust is tax-exempt. The plan sponsor will take all
steps, if any, to maintain the Plans qualified status.
5. Administrative and Operating Expenses
The Companies pay substantially all administrative and operating expenses of the Plan.
9
Farm Bureau 401(k) Savings Plan
Schedule H, Line 4(i) Schedule of Assets (Held at End of Year)
E.I.N. 42-0331840 Plan #004
December 31, 2007
|
|
|
|
|
|
|
|
|
|
|
|
|
Description of Investment, Including Maturity |
|
|
|
|
|
|
|
Identity of Issue, Borrower, |
|
Date, Rate of Interest, Collateral, Par or |
|
|
|
|
|
Current |
|
Lessor, or Similar Party |
|
Maturity Value |
|
Cost (1) |
|
|
Value |
|
|
Participant directed: |
|
|
|
|
|
|
|
|
|
|
|
|
Mutual funds, at fair value: |
|
|
|
|
|
|
|
|
EquiTrust Series Fund, Inc. (2) |
|
High Grade Bond Portfolio |
|
|
|
|
|
$ |
4,769,740 |
|
EquiTrust Series Fund, Inc. (2) |
|
Strategic Yield Portfolio |
|
|
|
|
|
|
2,968,465 |
|
EquiTrust Series Fund, Inc. (2) |
|
Managed Portfolio |
|
|
|
|
|
|
6,633,489 |
|
EquiTrust Series Fund, Inc. (2) |
|
Blue Chip Portfolio |
|
|
|
|
|
|
10,966,943 |
|
EquiTrust Series Fund, Inc. (2) |
|
Value Growth Portfolio |
|
|
|
|
|
|
6,060,146 |
|
American Century Investments |
|
Small Cap Value Fund |
|
|
|
|
|
|
6,472,322 |
|
American Funds |
|
Euro Pacific Growth Fund |
|
|
|
|
|
|
11,239,889 |
|
American Funds |
|
Growth Fund of America Fund |
|
|
|
|
|
|
8,845,259 |
|
Van Kampen |
|
Comstock Fund A |
|
|
|
|
|
|
5,666,863 |
|
Vanguard |
|
Explorer Fund |
|
|
|
|
|
|
6,957,479 |
|
Vanguard |
|
S&P 500 Index Fund |
|
|
|
|
|
|
877,635 |
|
Wells Fargo Bank, N.A. (2) |
|
S&P MidCap Index Fund |
|
|
|
|
|
|
8,590,604 |
|
Wells Fargo Bank, N.A. (2) |
|
Advantage Dow Jones Target Date Fund Today |
|
|
|
|
|
|
275,863 |
|
Wells Fargo Bank, N.A. (2) |
|
Advantage Dow Jones Target Date Fund 2010 |
|
|
|
|
|
|
678,850 |
|
Wells Fargo Bank, N.A. (2) |
|
Advantage Dow Jones Target Date Fund 2020 |
|
|
|
|
|
|
845,130 |
|
Wells Fargo Bank, N.A. (2) |
|
Advantage Dow Jones Target Date Fund 2030 |
|
|
|
|
|
|
256,584 |
|
Wells Fargo Bank, N.A. (2) |
|
Advantage Dow Jones Target Date Fund 2040 |
|
|
|
|
|
|
436,361 |
|
Wells Fargo Bank, N.A. (2) |
|
Advantage Dow Jones Target Date Fund 2050 |
|
|
|
|
|
|
61,204 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Pooled investment trust, at fair value: |
|
|
|
|
|
|
|
|
FBL Financial Group, Inc. (2) |
|
FBL Financial Group, Inc. common stock |
|
|
|
|
|
|
24,169,653 |
|
Wells Fargo Bank, N.A. (2) |
|
Short-Term Investment Fund for EBT |
|
|
|
|
|
|
576,557 |
|
|
|
|
|
|
|
|
|
|
|
|
Farm Bureau Life Insurance Company (2) |
|
Group flexible premium deferred annuity, at fair value |
|
|
|
|
|
|
15,578,781 |
|
|
|
|
|
|
|
|
|
|
|
|
Various participants |
|
Notes receivable, 4.00% - 8.25%, due through December 2012 |
|
|
|
|
|
|
2,934,356 |
|
|
|
|
|
|
|
|
|
|
|
Total investments |
|
|
|
|
|
|
|
$ |
125,862,173 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(1) |
|
Cost information is only required for non-participant-directed investments. |
|
(2) |
|
The issuer is considered a party in interest to the Plan. |
11