SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
Form 11-K
\X\ ANNUAL REPORT PURSUANT TO SECTION 15(d) OF THE SECURITIES EXCHANGE ACT OF
1934 FOR THE FISCAL YEAR ENDED JUNE 30, 2003, OR
\ \ TRANSITION REPORT PURSUANT TO SECTION 15(d) OF THE SECURITIES EXCHANGE
ACT OF 1934 [NO FEE REQUIRED] for the transition period from _________
to _______________
Commission file number 001-00434
A. Full title of the plan and the address of the plan, if different from that
of the issuer named below: Group Profit sharing, Incentive and Employer
Contribution Plan (France), c/o Groupe Procter & Gamble en France, Service
Relations Exterieures, 96 avenue Charles de Gaulle, 92200 Neuilly sur
Seine.
B. Name of issuer of the securities held pursuant to the plan and the address
of its principal executive office: The Procter & Gamble Company, One
Procter & Gamble Plaza, Cincinnati, Ohio 45202
REQUIRED INFORMATION
Item 1. Audited statement of financial condition as of the end of the latest two
fiscal years of the plan (or such lesser period as the plan has been in
existence). (See Page 2)
Item 2. Audited statement of income and changes in plan equity for each of the
latest three fiscal years of the plan (or such lesser period as the plan
has been in existence). (See Page 3)
PROCTER & GAMBLE SERVICES FRANCE S.A.S.
GROUP PROFIT SHARING, INCENTIVE AND EMPLOYER
CONTRIBUTION PLAN (FRANCE)
STATEMENTS OF NET ASSETS AVAILABLE FOR BENEFITS AS OF JUNE 30, 2003 AND
2002, STATEMENTS OF CHANGES IN NET ASSETS AVAILABLE FOR BENEFITS FOR THE
YEARS ENDED JUNE 30, 2003, 2002, AND 2001 AND INDEPENDENT AUDITORS' REPORT
PROCTER & GAMBLE SERVICES FRANCE S.A.S.
GROUP PROFIT SHARING, INCENTIVE AND EMPLOYER
CONTRIBUTION PLAN (FRANCE)
TABLE OF CONTENTS
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PAGE
INDEPENDENT AUDITORS' REPORT 1
FINANCIAL STATEMENTS:
Statements of Net Assets Available for Benefits as of
June 30, 2003 and 2002 2
Statements of Changes in Net Assets Available for Benefits for
the Years Ended June 30, 2003, 2002 and 2001 3
Notes to Financial Statements for the Years Ended
June 30, 2003, 2002 and 2001 4
INDEPENDENT AUDITORS' REPORT
To Procter & Gamble Services France S.A.S. and the participants of the Group
Profit Sharing, Incentive and Employer Contribution Plan (France):
We have audited the accompanying statements of net assets available for benefits
of the Group Profit Sharing, Incentive and Employer Contribution Plan (France)
(the "Plan") as of June 30, 2003, and the related statements of changes in net
assets available for benefits for the year 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. The
financial statements of the Plan for the years ended June 30, 2002 and 2001 were
audited by other auditors whose report, dated September 27, 2002, expressed an
unqualified opinion of those statements.
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 audit provides a
reasonable basis for our opinion.
In our opinion, such financial statements present fairly, in all material
respects, the net assets available for benefits of the Plan at June 30, 2003,
and the changes in net assets available for benefits for the year then ended in
conformity with accounting principles generally accepted in the United States of
America.
/S/ DELOITTE & TOUCHE
------------------------------
DELOITTE & TOUCHE
Paris, France
September 17, 2003
REPORT OF INDEPENDENT ACCOUNTANTS
To Procter & Gamble Services France S.A.S. and the Participants of Group
Profit Sharing, Incentive and Employer Contribution Plan (France):
In our opinion, the accompanying statements of financial condition, the related
statements of income and changes in plan equity, and the supplemental schedule
(together, the "financial statements") present fairly, in all material respects,
the financial position of Group Profit Sharing, Incentive and Employer
Contribution Plan (France) (the "Plan") at June 30 2002 and 2001, and its
operations and changes in plan equity for each of the three years in the period
ended June 30, 2002 in conformity with accounting principles generally accepted
in the United States of America. These financial statements are the
responsibility of Procter & Gamble Services France S.A.S.; our responsibility is
to express an opinion on these financial statements based on our audits. We
conducted our audits of these statements in accordance with auditing standards
generally accepted in the United States of America, which 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, 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.
/S/ PRICEWATERHOUSECOOPERS
---------------------------
PricewaterhouseCoopers
Paris, France
September 27, 2002
PROCTER & GAMBLE SERVICES FRANCE S.A.S.
GROUP PROFIT SHARING, INCENTIVE AND EMPLOYER
CONTRIBUTION PLAN (FRANCE)
STATEMENTS OF NET ASSETS AVAILABLE FOR BENEFITS
AS OF JUNE 30, 2003 AND 2002
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2003 2002
in Euros
ASSETS:
Investments at fair value (Notes 1, 2) 91,674,988 10,803,433
Employers contributions receivable 6,749,000 5,728,104
---------- ----------
NET ASSETS AVAILABLE FOR BENEFITS 98,423,988 16,531,537
========== ==========
See notes to financial statements.
PROCTER & GAMBLE SERVICES FRANCE S.A.S.
GROUP PROFIT SHARING, INCENTIVE AND EMPLOYER
CONTRIBUTION PLAN (FRANCE)
STATEMENTS OF CHANGES IN NET ASSETS AVAILABLE FOR BENEFITS
FOR THE YEARS ENDED JUNE 30, 2003, 2002 AND 2001
--------------------------------------------------------------------------------
2003 2002 2001
in Euros
ADDITIONS:
* Net appreciation (depreciation)
in fair value of investments (11,060,419) 10,803,433 12,846,447
* Contributions:
Employees contributions 2,887,929 2,985,668 3,031,035
Employers contributions 7,480,508 6,781,691 7,520,137
----------- ----------- -----------
Total contributions 10,368,437 9,767,359 10,551,172
----------- ----------- -----------
* Total changes: (691,982) 20,570,792 23,397,619
----------- ----------- -----------
DEDUCTIONS -
* Withdrawals by participants (11,695,248) (17,652,910) (10,672,063)
----------- ----------- -----------
NET INCREASE (DECREASE) (12,387,230) 2,917,882 12,725,556
NET ASSETS AVAILABLE FOR BENEFITS:
* Beginning of year 110,811,218 107,893,336 95,167,780
----------- ----------- -----------
* End of year 98,423,988 110,811,218 107,893,336
=========== =========== ===========
See notes to financial statements.
PROCTER & GAMBLE SERVICES FRANCE S.A.S.
GROUP PROFIT SHARING, INCENTIVE AND EMPLOYER
CONTRIBUTION PLAN (FRANCE)
NOTES TO FINANCIAL STATEMENTS
FOR THE YEARS ENDED JUNE 30, 2003, 2002 AND 2001
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1. DESCRIPTION OF THE PLAN
The following brief description of Procter & Gamble Services France
S.A.S.' Group Profit Sharing, Incentive and Employer Contribution Plan
(the "Plan") is provided for general information only. Participants should
refer to their country's Plan supplement for more complete information.
GENERAL--The Plan is an employee savings plan established on December 17,
1990 by agreement between Procter & Gamble services France S.A.S. together
with its, directly or indirectly wholly-owned subsidiaries, and those
subsidiaries' respective COMITES CENTRAUX D'ENTREPRISE ("Employee
Committees"), in order to provide a means for eligible employees to save
and invest their income, group profit sharing, and incentive remuneration.
The most recent Plan agreement took effect on January 1, 2003 and is
signed by Procter & Gamble Services France S.A.S., Procter & Gamble France
SNC, Laboratoire Lachartre SNC, Procter & Gamble Pharmaceuticals France
S.A.S. and Procter & Gamble Pharmaceuticals Longjumeau S.A.S., Procter &
Gamble Amiens SNC, Procter & Gamble Blois S.A.S., Procter & Gamble
Orleans, IAMS France S.A.S. (together, "P&G France"), and their related
Employee Committees. Procter & Gamble Services France S.A.S. is a
wholly-owned subsidiary of The Procter & Gamble Company, Inc. (the
"Parent"). The Plan is subject to the laws and regulations of France. Plan
assets are invested in four FONDS COMMUN DE PLACEMENT D'ENTREPRISE
("FCPE") which are registered investment funds reserved to employees of
Procter & Gamble in France subject to the laws and regulations of France.
ADMINISTRATION--Administration of the Plan is jointly executed by Procter
& Gamble Services France S.A.S. and Interepargne S.A., the fund manager.
The four FCPE are under the supervision of the CONSEILS DE SURVEILLANCE
("Monitoring Committees") which are composed of both employee and employer
representatives of P&G France.
PARTICIPANTS ACCOUNTS AND INVESTMENTS OPTIONS--An account is maintained
for each employee, and reflects employee and employer contributions as
well as employee withdrawals. There is no provision for the allocation of
income since the FCPE's do not pay dividends. Participants are permitted
to invest certain contributions into any of the four FCPE's; however,
certain other contributions from employees and from P&G France are
mandatorily invested in FCPE Groupe Procter & Gamble (Option D). Amounts
may be transferred from one FCPE to another FCPE except that "blocked"
amounts may not be transferred out of FCPE Groupe Procter & Gamble (Option
D).
Participants may allocate their account balances to one or all of the
following investment options offered by the Plan:
o FCPE GROUPE PROCTER & GAMBLE ACTIONS (OPTION A) - The prospectus
indicates that this fund is invested in securities or in mutual
funds which invest primarily in securities.
o FCPE GROUPE PROCTER & GAMBLE OBLIGATIONS (OPTION B) - The
prospectus indicates that this fund is invested in bonds or in
mutual funds which invest primarily in bonds.
o FCPE GROUPE PROCTER & GAMBLE 5000 (OPTION C) - The prospectus
indicates that this fund is invested at least at 75% in French
securities, or in mutual funds invested at least at 60% in
securities.
o FCPE GROUPE PROCTER & GAMBLE (OPTION D) - The prospectus
indicates that this fund is invested uniquely in The Procter &
Gamble Company, Inc. common stock.
CONTRIBUTION AND VESTING--Employees are eligible for Plan participation
three months after their start date with P&G France. Contributions are
made by Plan participants as well as by P&G France as follows:
Employees' Contributions:
- VOLUNTARY, PERIODIC CONTRIBUTIONS - These are usually contributed on a
monthly basis, they are eligible for matching contributions from P&G
France. These contributions are automatically invested in Option D.
- VOLUNTARY, COMPLEMENTARY CONTRIBUTIONS - Employees may make
complementary contributions whenever they wish, although these amounts
receive no matching contributions. These contributions are invested at the
discretion of the employee in one of the four FCPE's.
Employers' Contributions:
- EMPLOYER MATCHING CONTRIBUTIONS -P&G France makes matching contributions
of between 50 and 100 percent, based on employees' voluntary, periodic
contributions. These matching contributions are automatically invested in
Option D.
- PROFIT SHARING -P&G France calculates and distributes these
contributions according to French law as well as a supplementary
profit-sharing agreement. These amounts are invested at the discretion of
the employee in one of the four FCPE's. If no investment direction has
been given by an employee, amounts are automatically invested as per the
last investment choice or, by default, in Option D.
- INCENTIVE COMPENSATION -P&G France contributes incentive amounts to
employees according to an incentive compensation agreement. Employees have
the option to receive these amounts immediately, or to contribute these
amounts to the Plan. Amounts contributed to the Plan are invested at the
discretion of the employee in one of the four FCPE's, or automatically
invested as per the last investment choice.
All contributions are immediately 100 percent vested.
WITHDRAWALS--All contributions are "blocked" for a period of five years
beginning on October 1st of the calendar year in which the contribution
was made. After this period, amounts are available for withdrawal without
restriction. Under certain circumstances, as defined by law, a participant
may withdraw "blocked" contributions. All amounts become immediately
available for withdrawal upon the termination of employment.
PLAN TERMINATION - The Plan agreement must be renewed every three years by
written agreement between P&G France and their related Employee
Committees. Thus, the present Plan will terminate on June 30, 2005.
Although the Plan is expected to be renewed by all parties, any party has
the right to decline to the renewal.
In the event of Plan termination, the FCPE's will either remain active or
will be merged with other FCPE's. Thus, Plan participants will have the
option to withdraw "unblocked" amounts or to remain invested. Future
employee and employer contributions to the Plan would then be suspended.
2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
BASIS OF ACCOUNTING - The accompanying financial statements have been
prepared on the accrual basis of accounting and the Plan's net assets and
transactions are recorded at fair value.
PLAN INVESTMENTS - The Plan's investments are presented at fair-value
based upon the net asset value of the units of each FCPE held by the Plan
at year end. The net asset values of the FCPE's are determinated by the
fund manager, Interepargne S.A., based upon the fair value of the FCPE's
underlying investments, less any liabilities.
Purchases and sales of investments are recorded on a trade date basis. The
cost of investments sold is determined using average cost.
EXPENSES OF THE PLAN - Investment management, record keeping expenses, and
other administrative expenses are paid by P&G Services France S.A.S.
Brokerage commissions are paid by the participants, and other costs
related to the purchase or sale of shares are reflected in the price of
the shares and borne by the participants.
COMMISSIONS ON SUBSCRIPTIONS - Contributions made to the plan are subject
to a commission of 0,50 percent. These commissions are recorded in the
amount of the subscriptions to the FCPE.
USE OF ESTIMATES - The preparation of financial statements in conformity
with accounting principles generally accepted in the United States of
America 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.
The Plan invests in P&G common stock and in mutual funds. 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 plan benefits.
CONTRIBUTIONS RECEIVABLE - Contributions that are pending transfer to the
Trustee as of June 30, 2003 and 2002 are recorded as contributions
receivable to the Plan in the accompanying financial statements.
3. INVESTMENTS
Investments held by the Plan at June 30, 2003 and 2002 were as follows:
2003 2002
NUMBER MARKET NUMBER MARKET
OF SHARES VALUE OF SHARES VALUE
Investments of each FCPE (EUROS) (EUROS)
o Groupe Procter & Gamble Actions (Option A)* 359 656 15 107 077 381 216 17 848 544
o Obligations (Option B)* 437 816 11 054 129 436 141 9 926 572
o 5000 (Option C)* 652 183 4 781 709 569 216 4 866 798
o Groupe Procter & Gamble (Option D)* 778 068 60 732 073 802 850 72 441 200
TOTAL INVESTMENTS 91 674 988 105 083 114
*REPRESENTS INVESTMENTS WHICH EXCEED FIVE PERCENT OF NET ASSETS
AVAILABLE FOR BENEFITS
4. NONPARTICIPANT-DIRECTED INVESTMENT
FCPE Option D is considered to be nonparticipant-directed under the
guidance of SOP 99-3 because participants are required to maintain
contributed funds in the Parent's stock.
The net assets of FCPE Option D as of June 30 are as follows:
2003 2002
(EUROS) (EUROS)
Net assets - P&G Stock 64,107,073 75,196,304
========== ==========
The significant components of the changes in net assets of the P&G Stock
Fund consist of the following for the year ended June 30, 2003:
In euros
Net appreciation in fair value (9,652,903)
Employees contribution 2,930,067
Employer contribution 4,506,057
Withdrawals by participants (8,872,452)
----------
Total changes in net assets (11,089,231)
Net assets, beginning of year 75,196,304
----------
Net assets, end of year 64,107,073
==========
5. PLAN PARTICIPANTS
As of June 30, 2003, the Plan had approximately 3,800 participants.
6. TAX STATUS
The Plan and the underlying FCPE's are subject to the tax laws of France.
The Plan and the underlying FCPE's are tax-exempt according to French
tax law. Thus, no provision for income taxes has been reflected in the
accompanying financial statements.
THE PLAN. Pursuant to the requirements of the Securities Act of 1933, PROCTER
& GAMBLE SERVICES FRANCE, who administers the employee benefit plan
has duly signed the Annual Report on September 15, 2003.
GROUP PROFIT SHARING, INCENTIVE AND EMPLOYER
CONTRIBUTION PLAN (FRANCE)
By: PROCTER & GAMBLE SERVICES FRANCE
/s/ Philippe Charrier
-------------------------------------
Philippe Charrier
President
EXHIBIT INDEX
Exhibit No. Page No.
23a Consent of Deloitte & Touche
23b Consent of PricewaterhouseCoopers