United States 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, 2004
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or
--
[ ] Transition Report Pursuant to Section 15(d) of the Securities Exchange Act
of 1934
For the transition period from to
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Commission file number 001-11 001
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Citizens 401(k) Savings Plan
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(Full title of the Plan)
Citizens Communications Company
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3 High Ridge Park
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P.O. Box 3801
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Stamford, CT 06905
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(Name of issuer of the securities held
pursuant to the Plan and the address
of its principal executive offices)
CITIZENS 401(k) SAVINGS PLAN
Financial Statements and Supplemental Schedules
December 31, 2004 and 2003
(With Report of Independent Registered Public Accounting Firm Thereon)
CITIZENS 401(k) SAVINGS PLAN
Table of Contents
Page
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Reports of Independent Registered Public Accounting Firms 1-2
Financial Statements:
Statements of Net Assets Available for Benefits - December 31, 2004 and 2003 3
Statement of Changes in Net Assets Available for Benefits For the Year Ended December 31, 2004 4
Notes to Financial Statements 5-12
Supplemental Schedules:*
Schedule H, Line 4(i) - Schedule of Assets (Held at End of Year) as of December 31, 2004 13
Signature 14
Consents of Independent Registered Public Accounting Firms 15-16
* Schedules required by Form 5500 that are not applicable have not been included
Report of Independent Registered Public Accounting Firm
To the Participants and Plan Administrator of the Citizens 401(k) Savings Plan:
We have audited the statement of net assets available for benefits of the
Citizens 401(k) Savings Plan (the "Plan") as of December 31, 2004, and the
related statement of changes in net assets available for benefits for the year
ended December 31, 2004. 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 audit.
We conducted our audit in accordance with the auditing 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
audit provides 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, 2004 and the changes in net assets available for benefits for the
year ended December 31, 2004, in conformity with U.S. generally accepted
accounting principles.
Our audit was performed for the purpose of forming an opinion on the basic
financial statements taken as a whole. The supplemental Schedule H, Schedule of
Assets (Held at End of Year), for the year ended December 31, 2004 is presented
for the purposes of additional analysis and is not a required part of the basic
financial statements but is supplementary information required by the Department
of Labor 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. This supplemental schedule has been
subjected to the auditing procedures applied in the audit 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/ Insero, Kasperski, Ciaccia & Co., P.C.
Certified Public Accountants
Insero, Kasperski, Ciaccia & Co., P.C.
Certified Public Accountants
Rochester, New York
May 26, 2005
1
Report of Independent Registered Public Accounting Firm
To Citizens Communications Company,
The Plan Administrator of the Citizens 401(k) Savings Plan:
We have audited the accompanying statement of net assets available for benefits
of the Citizens 401(k) Savings Plan (the "Plan") as of December 31, 2003. This
financial statement is the responsibility of the Plan's management. Our
responsibility is to express an opinion on this financial statement based on our
audit.
We conducted our audit 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
statement is free of material misstatement. An audit includes examining, on a
test basis, evidence supporting the amounts and disclosures in the financial
statement. 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, the financial statement referred to above presents fairly, in
all material respects, the net assets available for benefits of the Plan as of
December 31, 2003, in conformity with U.S. generally accepted accounting
principles.
/s/ KPMG LLP
New York, New York
June 28, 2004
2
CITIZENS 401 (k) SAVINGS PLAN
Statements of Net Assets Available for Benefits
December 31, 2004 and 2003
2004 2003
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Assets:
Investments (note 3):
Citizens Communications Company common stock $ 66,737,216 $ 61,453,615
Global Crossing common stock - 31,887
Mutual funds 128,063,359 97,779,502
Collective trusts 118,778,484 114,181,713
Participant loans 14,468,743 12,705,062
Brokerage accounts 132,009 85,446
Money market fund - 8,836
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Total investments 328,179,811 286,246,061
Receivables:
Employer contributions 127,763 612,502
Participant contributions 319,990 877,547
Global Crossing settlement (note 9) 20,771,420 -
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Total receivables 21,219,173 1,490,049
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Net assets available for benefits $ 349,398,984 $ 287,736,110
=================== ===================
See accompanying notes to financial statements.
3
CITIZENS 401 (k) SAVINGS PLAN
Statement of Changes in Net Assets Available for Benefits
Year ended December 31, 2004
Additions to net assets attributed to: 2004
-------------------
Investment income:
Dividends $ 18,031,504
Interest 647,934
Net appreciation in fair value of investments (note 3) 34,755,344
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53,434,782
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Contributions:
Participant 22,683,333
Employer 9,660,855
Rollover 575,828
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32,920,016
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Receivable associated with Global Crossing settlement (note 9) 20,771,420
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Total additions 107,126,218
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Deductions to net assets attributed to:
Distributions to participants (45,431,120)
Miscellaneous expenses (32,224)
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Total deductions (45,463,344)
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Net increase in assets available for benefits 61,662,874
Net assets available for benefits:
Beginning of year 287,736,110
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End of year $ 349,398,984
===================
See accompanying notes to financial statements.
4
CITIZENS 401(k) SAVINGS PLAN
Notes to Financial Statements
December 31, 2004 and 2003
(1) Description of the Plan
General
The following description of the Citizens 401(k) Savings Plan (the
"Plan") provides general information. Participants should refer to the
Plan document for a more comprehensive description of the Plan's
provisions.
(a) Background
The Plan is a voluntary defined contribution plan sponsored by
Citizens Communications Company (the "Company"). Under the terms
of the Plan, employees (other than Frontier union employees) who
have attained three months of continuous service are eligible to
participate in the Plan. Frontier union employees covered by
collective bargaining agreements, except for temporary, summer,
and leased employees, are eligible to participate in the Plan on
the first day of the month coincident with or next following
his/her completion of 30 days of employment. The Plan is subject
to the provisions of the Employee Retirement Income Security Act
of 1974 ("ERISA").
Effective August 4, 2004, T. Rowe Price replaced Putnam as the
trustee and recordkeeper of the Plan.
On April 1, 2004, the Company completed the sale of its Vermont
electric division. In conjunction with the sale, the balances of
participant accounts of those employees in the amount of
$1,629,039 were rolled over to buyer's retirement plan.
On August 8, 2003, the Company completed the sale of The Gas
Company of Hawaii division. In conjunction with the sale, the
balances of participant accounts of those employees in the amount
of $6,933,199 were rolled over to buyer's retirement plan.
On August 11, 2003, the Company completed the sale of its Arizona
gas and electric divisions. In conjunction with the sale, the
balances of participant accounts of those employees in the amount
of $5,986,061 were rolled over to buyer's retirement plan.
Effective January 1, 2002, the Company adopted "good faith"
Economic Growth and Tax Relief Reconciliation Act amendments to
the Plan and to the Frontier Union 401(k) Savings Plan. Effective
December 31, 2002, the Frontier Union 401(k) Savings Plan was
merged into the Plan. The Plan was amended and restated,
effective January 1, 2003 (except as otherwise provided in the
Plan), to reflect such merger, to reflect the introduction of
Supplemental Profit Sharing Matches, and to reflect various
administrative changes to the Plan. On January 2, 2003, the
balances of the participant accounts of those employees in the
amount of $39,452,866 were rolled over into the Citizens 401(k)
Savings Plan.
(b) Contributions
Eligible employees (other than Frontier union employees) may
contribute, in 1% increments, up to 75% (50% prior to January 1,
2004) of their annual eligible compensation in elective pre-tax
deferrals through payroll deductions, subject to certain maximum
contribution restrictions. Prior to January 1, 1992, participants
had an option to elect life insurance coverage as an investment
vehicle. Beginning January 1, 1992, such option was discontinued,
except that participants who had elected life insurance coverage
prior to January 1, 1992 could continue to make specific dollar
allocations to purchase additional life insurance coverage. As of
December 31, 2003, all life insurance policies were transferred
out of the Plan.
5
Eligible Frontier union employees covered by collective
bargaining agreements may contribute, in 1% increments, up to 75%
(50% prior to January 1, 2004) of their annual eligible
compensation in elective pre-tax deferrals through payroll
deductions, subject to certain maximum contribution restrictions.
In addition, a participant may elect to make after-tax
contributions in 1% increments, of their annual eligible
compensation through payroll deductions up to (i) 50% reduced by
(ii) the percentage of eligible compensation with respect to
elective pre-tax deferrals.
All employees eligible to make contributions under the Plan and
who have attained or will attain age 50 before the close of the
Plan year shall be eligible to make catch-up contributions in
accordance with, and subject to the limitations of, Section
414(v) of the Internal Revenue Code (the "Code"). No matching
contributions shall be made with respect to a Participant's
catch-up contributions.
The Company, at its sole discretion, may amend its contribution
to the Plan. The Company contribution for the 2004 Plan year
amounted to 50% of up to the first 6% of each Participant's
eligible compensation that a non-bargaining participant
contributes to the Plan. Company contributions for participants
covered by collective bargaining agreements are determined based
on the terms of those agreements. Through April 30, 2002, the
Company contributions were invested entirely in the Citizens
Communications Company stock fund unless a participant was age 55
or older in which case the participant could have elected to have
the Company contribution invested in investments at his/her own
discretion. In addition, at age 55 a participant can request to
transfer previous Company contributions invested in the above
common stock fund to other investment options. Effective March 1,
2004, the Company match made previously in the form of Company
stock became unrestricted for certain collective bargaining
employees.
For Frontier union employees covered by collective bargaining
agreements, the Company may contribute Employer Fixed
Contributions, Employer Matching Contributions or Employer Profit
Sharing Contributions (as defined by the Plan). Participants
should refer to their respective bargaining agreements for all
employer contribution requirements.
As of May 1, 2002, the Company contribution for non-union and
certain union participants is no longer exclusively allocated to
Citizens Communications Company common stock. The Company
contributions for these participants made subsequent to May 1,
2002 are allocated to Plan investments following the same method
of allocation as that for participant-directed investments. In
addition, Supplemental Profit Sharing Matches may be contributed
at the option of the Company's Board of Directors contingent upon
the Company's exceeding financial targets. For each 1% above the
Company's EBITDA goal, the Company provides employees with 0.5%
of eligible pay in the form of a matching contribution into the
401(k) plan, up to a maximum of 3%. For the year ended December
31, 2004, the Company exceeded its EBITDA goal and a 1.5%
supplemental profit sharing match was made on behalf of 2,133
employees. No discretionary contributions were made for the year
ended December 31, 2003.
(c) Participant Accounts
Each participant's account is credited with the participant's
contribution and an allocation of (a) the Company's contribution
and (b) Plan earnings or losses. Allocations are based on each
participant's contribution, as defined. The benefit to which a
participant is entitled is the amount that can be provided from
the participant's vested account.
6
(d) Vesting
Participants are vested immediately in their contributions plus
the allocated earnings thereon. Participants become 100% vested
in the Company contributions and the related earnings on the
Company contributions upon disability, death, attainment of
normal retirement age or after five years of service. Except as
otherwise noted, for any other termination of employment, the
vesting schedule is as follows:
Vested percentage of
Company contribution and
Years of service related earnings
--------------------------------- ---------------------------
Less than 2 years 0%
2 years but less than 3 years 40%
3 years but less than 4 years 60%
4 years but less than 5 years 80%
5 years or more 100%
Frontier union employees covered by collective bargaining
agreements are immediately 100% vested in all contributions and
allocated earnings thereon.
(e) Participant Loans
Participants in the Plan may request to borrow up to the lesser
of 50% of their vested account balance or $50,000. The interest
rate paid by the participant is equal to the prime interest rate
in effect at the beginning of the month in which the loan is
processed and remains fixed at that rate for the term of the
loan. Loan repayments are made through payroll deductions, after
tax, and are credited to each Participant's account as the
payments are made. A participant may repay a loan in full at any
time by remitting his/her payment directly to the trustee of the
Plan. In the event of termination of employment, a participant's
loan may be repaid in full or the loan will be canceled and the
participant's final distribution will be reduced by the amount of
the outstanding loan balance.
(f) Payment of Benefits
Inactive participants do not have the option to keep any portion
of their account in the Plan beyond the attainment of age 70 1/2.
Participants still employed by the Company at age 70 1/2, must
take a full distribution of their balances on or before April 1st
of the calendar year after they retire.
Upon termination of employment, a participant is entitled to
receive payment in full of the vested portion of his/her account.
If the value of the terminating participant's vested account
balance exceeds $5,000, the participant may elect to defer
his/her distribution.
(g) Forfeitures
For the year ended December 31, 2004 forfeited nonvested Company
contributions totaled $451,138. These amounts are generally used
to reduce the obligation of the Company to make contributions to
the Plan and defray administrative costs. For the year ended
December 31, 2004, $0 of forfeited nonvested Company
contributions were used to fund Plan administrative expenses, and
$276,206 were used to fund the Company match. The remainder will
be used to reduce future employer contributions.
7
(h) Administrative Costs
The majority of Plan administrative costs are paid by
Participants through investment management fees. There were no
Plan administrative expenses charged by T. Rowe Price for the
year ended December 31, 2004. Plan administrative expenses
charged by Putnam for the year ended December 31, 2004 of $24,840
were offset by the 2004 Plan Expense Reimbursement Agreement
(PERA) allowance.
(i) Investments
The Plan offered the following investment options as of December
31, 2004:
Citizens Communications Company Common Stock
PIMCO Total Return Fund, Admin. Shares
PIMCO Long Term U.S. Government Fund, Admin.
Dreyfus Premier New Leaders Fund, A
One Group Mid Cap Growth Fund, A
JP Morgan Mid Cap Value Fund, A
Morgan Stanley Institutional Small Company Growth Portfolio, B
Morgan Stanley Institutional International Equity Portfolio, B
Morgan Stanley Institutional U.S. Real Estate Fund, B
T. Rowe Price Stable Value Fund
T. Rowe Price Equity Index Trust (S & P 500)
T. Rowe Price Equity Income Fund
T. Rowe Price Personal Strategy Balanced Fund
T. Rowe Price Growth Stock Fund
T. Rowe Price Personal Strategy Growth Fund
T. Rowe Price Personal Strategy Income Fund
T. Rowe Price TradeLink
The Plan had investments in Global Crossing common stock as a
result of the transfer of net assets from the Frontier Savings
Plan to the Plan. The Plan trustee held such shares in custodial
account for the benefit of the previous Global Crossing employees
until such time as any such employee elected to dispose of his or
her shares based upon the Stock Purchase Agreement. However, the
Plan did not permit the participants to otherwise invest in
Global Crossing common stock, whether with additional
contributions made into the Plan, reallocation of other assets of
a participant's account, or otherwise. On January 28, 2002,
Global Crossing filed for bankruptcy. The value of the Plan's
investment in Global Crossing common stock declined significantly
since December 31, 2001, and as of December 9, 2003, Global
Crossing common stock had been delisted.
8
(2) Summary of Significant Accounting Policies
(a) Basis of Accounting
The financial statements of the Plan are prepared under the
accrual method of accounting.
(b) 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 reported amount of assets, liabilities, changes
therein, and disclosures of contingent assets and liabilities at
the date of the financial statements. The preparation of these
financial statements also requires the use of plan administrator
estimates. Actual results may differ from these estimates.
(c) Investments
The Plan's investments are stated at fair value. Shares of
registered investment companies (mutual funds) are valued at
quoted market prices, which represent the net asset value of
shares held by the Plan. Investments in collective trusts are
valued at fair value based on the underlying net assets of the
trust as reported by the sponsor of the collective trust. Common
stock is valued at its quoted market price as of the end of the
Plan year. Participant notes receivable are valued at cost, which
approximates fair value. The net depreciation/appreciation in the
fair value of investments consists of the net realized gains and
losses on the disposal of investments during 2004 and the net
unrealized appreciation/depreciation of the market value for the
investments remaining in the Plan as of December 31, 2004.
Purchases and sales of securities are recorded on a trade-date
basis. Interest income is recorded on the accrual basis.
Dividends are recorded on the dividend date.
(d) Benefits Paid
Benefits are recorded when paid.
(e) Risks and Uncertainties
The Plan offers a number of investment options including the
Company common stock and a variety of pooled investment funds,
some of which are registered investment companies. The investment
funds principally include U.S. equities, international equities,
and fixed income securities. Investment securities, in general,
are exposed to various risks, such as interest rate, credit, and
overall market volatility risk. Due to the level of risk
associated with certain investment securities, it is reasonable
to expect that changes in the values of investment securities
will occur in the near term and that such changes could
materially affect participant account balances.
The Plan's exposure to a concentration of credit risk is limited
by the diversification of investments across all
participant-directed fund elections. Additionally, the
investments within each participant-directed fund election are
further diversified into varied financial instruments, with the
exception of the Company common stock, which is invested in the
security of a single issuer.
9
(f) Adoption of New Accounting Pronouncement
Effective July 1, 2003, the Plan adopted the Financial Accounting
Standards Board's Statement of Financial Accounting Standards No.
149, "Amendment of Statement 133 on Derivative Instruments and
Hedging" (SFAS No. 149), which clarifies financial accounting and
reporting for derivative instruments including derivative
instruments embedded in other contracts. The adoption of SFAS No.
149 did not have any impact on the Plan's financial statements.
(3) Investments
The following presents investments that represent 5% or more of the
Plan's net assets at the end of year:
2004 2003
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Citizens Communications Company common stock:
Participant Directed, 4,565,627 and 3,536,840 shares,
respectively $ 62,960,043 $ 43,927,554
Nonparticipant Directed, 273,910 and 1,411,116 shares,
respectively 3,777,173 17,526,061
PIMCO Total Return Fund, Admin. Shares 25,146,749 24,856,532
Morgan Stanley Institutional International Equity Portfolio, B 21,287,656 -
T. Rowe Price Growth Stock Fund 21,700,334 -
T. Rowe Price Stable Value Fund 59,671,544 -
T. Rowe Price Equity Index Trust 59,106,940 -
Putnam International Equity Fund - 17,802,167
Putnam Stable Value Fund - 57,146,006
Putnam Voyager Fund - 19,702,898
Putnam S&P 500 Index Fund - 57,035,707
During 2004, the Plan's investments (including gains and losses on investments
bought and sold as well as held during the year) appreciated in value by
$34,755,344 as follows:
Common stocks $ 20,939,244
Mutual funds 8,272,496
Collective trusts 5,644,519
Brokerage accounts (100,915)
--------------------
$ 34,755,344
====================
10
(4) Nonparticipant-Directed Investments
Information about the assets available for benefits and significant
components of the changes in assets available for benefits relating to
the nonparticipant-directed investments is as follows:
2004 2003
-------------------- ------------------
Assets:
Common Stock of the Company at December 31 $ 3,777,173 $ 17,526,061
==================== ==================
Changes in assets:
Dividends 605,635 -
Net change in fair value of investments 3,065,827 2,996,731
Employer contributions - 407,302
Benefits paid to participants (572,621) (3,718,075)
Transfers out (15,182) (3,950,238)
Transfer to participant directed investments (13,800,830) -
Other (3,031,717) 4,925,348
-------------------- ------------------
Change in assets $ (13,748,888) $ 661,068
==================== ==================
(5) Investment Contracts with Insurance Company
The Plan had entered into two investment contracts with Travelers Life
and Annuity Company (Travelers). Travelers maintained the
contributions in guaranteed investment contracts. These contracts were
credited with earnings on the underlying investments and charged for
participant withdrawals and administrative expenses. These contracts
were included in the financial statements at contract value as
reported to the Plan by Travelers. Contract value represents
contributions made under the contract, plus earnings, less participant
withdrawals and administrative expenses. Participants may ordinarily
direct the withdrawals or transfer of all or a portion of their
investments at contract value.
During 2003, the Travelers investment contracts matured and were not
redeemed.
(6) Related Party Transactions
Certain Plan assets are invested in shares of mutual funds that are
managed by T. Rowe Price. T. Rowe Price is the trustee as defined by
the Plan, therefore these transactions qualify as party-in-interest
transactions. There were no fees paid by the Company to T. Rowe Price
for the period August 4, 2004 to December 31, 2004.
Prior to August 4, 2004, Putnam served as the Plan's trustee and
certain Plan assets were invested in shares of mutual funds that
Putnam manages. There were no fees paid by the Company to Putnam for
the period January 1, 2004 to August 3, 2004, and for the year ended
December 31, 2003.
(7) Plan Termination
Although it has not expressed any intention to do so, the Company has
the right under the Plan to discontinue its contributions at any time
and to terminate the Plan subject to the provisions of ERISA,
Collective Bargaining Agreements and the National Labor Relations
Board. In the event of plan termination, participants will become 100%
vested in their accounts.
11
(8) Tax Status
The Company received a favorable determination letter from the
Internal Revenue Service (IRS) dated September 24, 2002 stating that
the plan continues to qualify under Section 401(a) of the Code (IRC)
and the related trusts to be tax exempt under Section 501(a) of the
Code. The Plan Administrator and the Plan's tax counsel believe that
the Plan is currently designed and being operated in compliance with
the Code.
The Company has identified certain unintentional errors in the
operation of the Plan. The Company has completed evaluation of the
previously identified unintentional errors in the operation of the
Plan. The Plan has been amended and resubmitted to the IRS for a new
determination letter and approval on June 18, 2004, as supplemented on
February 18, 2005, through the IRS's Voluntary Compliance Program
(VCP), of the proposed remedies for such errors.
The Company fully expects the Plan to continue to qualify under
Section 401(a) of the Code and the related trusts to be tax exempt
under 501(a) of the Code. The Company believes that the outcome of the
VCP application will not have a material effect on the Plan's
financial statements.
(9) Subsequent Events and Other Matters
During 2004, the United States District Court for the Southern
District of New York approved a settlement of the class action suits
brought on behalf of Plan participants whose accounts held Global
Crossing common stock. The settlement included a plan of allocation
under which the proceeds of $20,771,420 were allocated to the Plan
accounts of the class members on May 19, 2005. As a result of this
settlement, the Plan no longer has investments in Global Crossing
common stock.
The following are significant amendments to the Plan adopted
subsequent to December 31, 2004:
Effective February 19, 2005, the One Group Mid Cap Growth Fund, A was
renamed the JP Morgan Diversified Mid Cap Growth Fund as a result of
the merger between JP Morgan and Bank One.
Effective March 28, 2005, upon termination of employment, if the value
of the terminating participant's vested account balance exceeds
$1,000, the participant may elect to defer his/her distribution.
12
CITIZENS 401(k) SAVINGS PLAN
Schedule H, line 4(i) - Schedule of Assets (Held at End of Year)
December 31, 2004
Identity of Issuer Description of Investment Current value
------------------------------------------------------------------------------------------------------------------------------------
* Citizens Communications Company Common Stock; 4,839,537 shares; cost at $55,188,065 $ 66,737,216
* T. Rowe Price TradeLink Brokerage Accounts; 132,009 shares 132,009
PIMCO Total Return Fund, Admin. Shares Mutual Funds; 2,356,771 shares 25,146,749
Dreyfus Premier New Leaders Fund, A Mutual Funds; 83,241 shares 3,697,577
One Group Mid Cap Growth Fund, A Mutual Fund; 257,142 shares 5,993,991
JP Morgan Mid Cap Value Fund, A Mutual Fund; 223,594 shares 4,930,258
PIMCO Long Term U.S. Government Fund, Admin. Mutual Fund; 168,559 shares 1,832,236
Morgan Stanley Institutional Small Company Growth
Portfolio, B Mutual Fund; 1,231,448 shares 14,802,000
Morgan Stanley Institutional International Equity
Portfolio, B Mutual Fund; 1,016,195 shares 21,187,656
Morgan Stanley Institutional U.S. Real Estate Fund, B Mutual Fund; 287,201 shares 6,617,118
* T. Rowe Price Personal Strategy Balanced Fund Mutual Fund; 273,235 shares 4,970,148
* T. Rowe Price Personal Strategy Income Fund Mutual Fund; 50,386 shares 747,730
* T. Rowe Price Growth Stock Fund Mutual Fund; 813,661 shares 21,700,334
* T. Rowe Price Equity Income Fund Mutual Fund; 546,853 shares 14,540,817
* T. Rowe Price Personal Strategy Growth Fund Mutual Fund; 86,570 shares 1,896,745
--------------
Total mutual funds 128,063,359
--------------
* T. Rowe Price Stable Value Fund Collective Trust; 59,671,544 shares 59,671,544
* T. Rowe Price Equity Index Trust Collective Trust; 1,729,790 shares 59,106,940
--------------
Total collective trust 118,778,484
--------------
* Participant loans 2,971 loans, maturing in 1 to 21 years, with interest
rates ranging from 4.0% to 10.0% 14,468,743
--------------
$ 328,179,811
==============
* Party-in-interest as defined by ERISA
See accompanying independent auditors' report.
13
Citizens 401(k) Savings Plan
Signature
---------
Pursuant to the requirements of the Securities Exchange Act of 1934, the Plan
Administrators have duly caused this annual report to be signed on its behalf by
the undersigned hereunto duly authorized.
Citizens 401(k) Savings Plan
By /s/ Robert J. Larson
----------------------------------------
Robert J. Larson
Senior Vice President and Chief Accounting Officer
June 29, 2005
14
Consent of Independent Registered Public Accounting Firm
We consent to the incorporation by reference in Registration Statement (No.
33-48683) on Form S-8 and in Registration Statement (No. 333-91054) on Form S-8
of Citizens Communications Company of our report dated May 26, 2005, relating to
the statement of net assets available for benefits of the Citizens 401(k)
Savings Plan as of December 31, 2004, and the related statement of changes in
net assets available for benefits for the year ended December 31, 2004, which
report appears in the Annual Report on Form 11-K.
/s/ Insero, Kasperski, Ciaccia & Co., P.C.
Certified Public Accountants
Rochester, New York
June 29, 2005
15
Consent of Independent Registered Public Accounting Firm
The Board of Directors
Citizens Communications Company:
We hereby consent to the incorporation by reference in Registration Statement
(No. 33-48683) on Form S-8 and in Registration Statement (No. 333-91054) on Form
S-8 of Citizens Communications Company of our report dated June 28, 2004,
relating to the statement of net assets available for benefits of the Citizens
401(k) Savings Plan as of December 31, 2003 which report appears in the annual
report on Form 11-K of the Citizens 401(k) Savings Plan for the fiscal year
ended December 31, 2004.
/s/ KPMG LLP
New York, New York
June 27, 2005
16