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, 2006.
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 1-8649.
|
A.
Full title of the plan and address of the plan if different
from
that of the issuer named below:
|
The
Toro Company Investment, Savings, and Employee Stock Ownership
Plan
The
Toro Company
8111
Lyndale Avenue South
Minneapolis,
MN 55420
Attn:
Director, Tax Accounting
|
B.
Name of issuer of the securities held pursuant to the plan
and the
address of its principal executive
office:
|
The
Toro Company
8111
Lyndale Avenue South
Minneapolis,
MN 55420
THE
TORO COMPANY INVESTMENT, SAVINGS,
AND
EMPLOYEE STOCK OWNERSHIP PLAN
Table
of Contents
|
Page
|
|
1
|
|
2
|
|
3
|
|
4
|
Schedule
*
|
|
|
13
|
*All
other schedules required by 29 CFR 2520.103-10 of the Department
of
Labor’s Rules and Regulations for Reporting and Disclosure under the
Employee Retirement Income Security Act of 1974 are not included
because
they are not applicable.
|
The
Plan
Administrator
The
Toro
Company Investment, Savings,
and
Employee Stock Ownership
Plan:
We
have
audited the accompanying statements of net assets available for benefits
of The
Toro Company Investment, Savings, and Employee Stock Ownership Plan (the
Plan)
as of December 31, 2006 and 2005, 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 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 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. 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, the financial statements referred to above present fairly, in all
material respects, the net assets available for benefits as of December 31,
2006
and 2005, and the changes in 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 basic
financial statements taken as a whole. The supplemental schedule of assets
(held
at end of the year) as of December 31, 2006 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 supplemental schedule is the
responsibility of the Plan’s management. The supplemental schedule has been
subjected to the auditing procedures applied in the audits 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/
KPMG
LLP
Minneapolis,
Minnesota
June
28,
2007
AND
EMPLOYEE STOCK OWNERSHIP
PLAN
Statements
of Net Assets Available for
Benefits
December
31, 2006 and 2005
|
|
2006
|
|
|
2005
|
|
Assets
held by Trustee:
|
|
|
|
|
|
|
Cash
and cash equivalents
|
|
$ |
130,126
|
|
|
|
101,157
|
|
Investments
at fair value
|
|
|
|
|
|
|
|
|
Mutual
funds
|
|
|
275,322,648
|
|
|
|
227,893,705
|
|
The
Toro Company Common Stock
|
|
|
211,063,851
|
|
|
|
219,066,721
|
|
Bond
collective funds
|
|
|
21,643,424
|
|
|
|
17,845,756
|
|
Master
Trust fund
|
|
|
85,386,077
|
|
|
|
78,713,802
|
|
Loans
|
|
|
23,871
|
|
|
|
30,622
|
|
|
|
|
|
|
|
|
|
|
Total
investments
|
|
|
593,439,871
|
|
|
|
543,550,606
|
|
|
|
|
|
|
|
|
|
|
Employee
contribution receivable
|
|
|
47,511
|
|
|
|
44,272
|
|
Employer
contribution receivable
|
|
|
12,107,989
|
|
|
|
11,852,788
|
|
Net
assets available for benefits at fair value
|
|
|
605,725,497
|
|
|
|
555,548,823
|
|
Adjustment
from fair value to contract value for
|
|
|
|
|
|
|
|
|
fully
benefit-responsive investment contracts
|
|
|
1,153,751
|
|
|
|
1,022,208
|
|
Net
assets available for benefits
|
|
$ |
606,879,248
|
|
|
|
556,571,031
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
See
accompanying notes to financial statements.
|
|
|
|
|
|
|
|
|
AND
EMPLOYEE STOCK OWNERSHIP
PLAN
Statements
of Changes in Net Assets Available for
Benefits
December
31, 2006 and 2005
|
|
2006
|
|
|
2005
|
|
Investment
income:
|
|
|
|
|
|
|
Interest
and dividends
|
|
$ |
16,349,796
|
|
|
|
8,500,775
|
|
Net
realized/unrealized gain in the fair value of investments
|
|
|
38,404,540
|
|
|
|
26,907,407
|
|
Pro
rata share of income from Master Trust
|
|
|
3,784,694
|
|
|
|
3,195,154
|
|
|
|
|
|
|
|
|
|
|
Net
investment income
|
|
|
58,539,030
|
|
|
|
38,603,336
|
|
|
|
|
|
|
|
|
|
|
Employer
contributions
|
|
|
15,084,808
|
|
|
|
14,695,150
|
|
Participant
contributions
|
|
|
12,500,531
|
|
|
|
11,994,170
|
|
Rollover
contributions
|
|
|
525,472
|
|
|
|
856,776
|
|
|
|
|
|
|
|
|
|
|
Total
contributions
|
|
|
28,110,811
|
|
|
|
27,546,096
|
|
|
|
|
|
|
|
|
|
|
Benefit
payments
|
|
|
(36,341,624 |
) |
|
|
(25,541,450 |
) |
|
|
|
|
|
|
|
|
|
Net
increase in net assets available for benefits
|
|
|
50,308,217
|
|
|
|
40,607,982
|
|
|
|
|
|
|
|
|
|
|
Net
assets available for benefits:
|
|
|
|
|
|
|
|
|
Beginning
of year
|
|
|
556,571,031
|
|
|
|
515,963,049
|
|
|
|
|
|
|
|
|
|
|
End
of year
|
|
$ |
606,879,248
|
|
|
|
556,571,031
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
See
accompanying notes to financial statements.
|
|
|
|
|
|
|
|
|
AND
EMPLOYEE STOCK OWNERSHIP
PLAN
Notes
to
Financial Statements
December
31, 2006 and 2005
(1)
|
Summary
of Significant Accounting
Policies
|
|
(a)
|
Basis
of Financial Statement
Presentation
|
The
accompanying financial statements of The Toro Company Investment, Savings,
and
Employee Stock Ownership Plan are presented in accordance with U.S generally
accepted accounting principles. The accounting records of the Plan are
maintained on the accrual basis.
The
Plan’s investments are held by JP Morgan Retirement Plan Services (the Trustee).
The investment securities are stated at fair values based upon published
quotations or, in the absence of available quotations, at fair values determined
by the Trustee. Purchases and sales of securities are recorded on a trade-date
basis.
The
Company maintains one Master Trust, the Wells Fargo Stable Value Fund E (Master
Trust) for three profit sharing and retirement plans that are sponsored by
the
Company. The three plans are the Plan, The Toro Company Profit Sharing Plan
for
Plymouth Union Employees and the Hahn Equipment Company Savings Plan for
Union
Employees. The purpose of the Master Trust is to pool investment transactions
and achieve uniform rates of return on comparable funds under all
plans. The Master Trust invests in fully benefit-responsive
investment contracts stated at fair value and then adjusted to contract
value. Fair value of the contracts is calculated by discounting the
related cash flows based on current yields of similar instruments with
comparable durations.
The
Plan’s proportionate share of net investment income from the Master Trust is
based upon the percentage of the fair value of the Plan’s investment in the
master trust’s net assets. The Plan’s percentage interest in the net assets of
the Master Trust was approximately 99% as of December 31, 2006 and
2005.
The
preparation of financial statements in conformity with U.S. generally accepted
accounting principles requires the Plan Administrator to make estimates and
assumptions that affect the reported amounts of net assets available for
benefits and disclosure of contingent assets and liabilities as of the date
of
the financial statements and the reported amounts of changes in net assets
available for benefits during the reporting period. Actual results could
differ
from those estimates.
|
(d)
|
Concentrations
of Risk
|
The
Plan
has investments in a variety of investment funds. Investments 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
investments, it is reasonably possible that changes in the values of the
investments 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.
Since
the
assets held by the Trust include The Toro Company Common Stock, the anticipated
assets available for benefits in 2007 will be the result of the Company’s future
stock market performance, which is subject to various risk factors described
more fully in the Company’s periodic filings with the Securities and Exchange
Commission.
THE
TORO COMPANY INVESTMENT,
SAVINGS,
AND
EMPLOYEE STOCK OWNERSHIP
PLAN
Notes
to
Financial
Statements
December
31, 2006 and 2005
(e) Adoption of New Accounting
Guidance
The
financial statements reflect the retroactive adoption of Financial Accounting
Standards Board Staff Position 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 FSP). As required by the FSP,
investment contracts held by a defined contribution plan are required to
be
reported at fair value. However, contract value is the relevant
measurement attribute for that portion of the net assets available for benefits
of a defined contribution plan attributable to fully benefit-responsive
investment contracts because contract value is the amount participants would
receive if they were to initiate permitted transactions under the terms of
the
Plan. As required by the FSP, the Statements of Net Assets Available
for Benefits presented the fair value of the Master Trust, as well as the
adjustment of the fully benefit-responsive investment contract from fair
value
to contract value. The Statement of Changes in Net Assets Available
for Benefits is prepared on a contract value basis.
Certain
amounts from prior years’ financial statements have been reclassified to conform
to the current year presentation.
(2)
|
Summary
Description of Plan
|
The
following description of The Toro Company Investment, Savings, and Employee
Stock Ownership Plan (the Plan) is provided for general information purposes
only. Participants should refer to the Plan document restated as of January
1,
2006 for more complete information. The Plan is subject to the
provisions of the Employee Retirement Income Security Act of 1974
(ERISA). Effective January 1, 2002, The Toro Company Employee Stock
Ownership Plan was merged into The Toro Company Investment and Savings Plan
to
become The Toro Company Investment, Savings, and Employee Stock Ownership
Plan.
However, there continues to be an Employee Stock Ownership (ESOP) portion
and a
profit sharing portion of the Plan. Effective September 2, 2003, the
Exmark Manufacturing Company, Inc. 401(k) Profit Sharing Plan was merged
into
the Plan. The Exmark Manufacturing Company, Inc. 401(k) Profit Sharing Plan
offered loans to participants. Since loans are not offered under the
Plan, outstanding loan balances were transferred as a result of the merger
into
the Plan and continue to be repaid by participants.
The
primary purpose of the ESOP portion of the Plan is to provide employees who
become participants in the Plan an opportunity to have their account balances
invested in Common Stock of The Toro Company. The portions of participant
accounts that hold Company Common Stock are included in the ESOP portion
of the
Plan. The portions of participant accounts that do not hold such stock are
included in the profit sharing portion of the Plan.
Participants
may make their own contributions to the Plan. These are initially made to
the profit sharing portion of the Plan.
Plan
participants are also eligible to have the Company make ESOP and Investment
Fund
Contributions to the Plan on their behalf after two years of qualifying service
with the Company. Participants are fully vested in the entire balance of
their
individual accounts attributable to those contributions. The Company also
makes
matching contributions to the Plan with respect to Participant contributions.
Participants are eligible for matching contributions after completing
one
THE
TORO COMPANY INVESTMENT,
SAVINGS,
AND
EMPLOYEE STOCK OWNERSHIP
PLAN
Notes
to
Financial Statements
December
31, 2006 and 2005
year
of
qualifying service with the Company. Company matching contributions, together
with income attributable thereto, vest at a rate of 20% after one year of
vesting service, with an additional 20% being accumulated annually thereafter
until the participant is 100% vested. ESOP Contributions and Matching
Contributions are initially invested in Company Common Stock.
Participants may
choose to have their accounts including those initially invested in Company
Common Stock invested in any of the investment funds made available
under the Plan or in Company Common Stock. All contributions under
the Plan are made to a trust that holds all of the assets of the
Plan.
Benefit
payments and transfers of participants’ interests are made by the
Trustee.
During
the year ended December 31, 2006 and 2005, forfeited nonvested accounts totaled
$4,921 and $10,400, respectively. These accounts are used to offset future
employer contributions.
The
Company absorbs all administrative costs of the Plan, with the exception
of
investment management fees, which are netted against investment
income.
(3)
|
Funding
Policy, Contributions, and Plan
Transfers
|
For
the
ESOP portion of the plan, the funding policy is to make annual contributions
pursuant to a formula and to make matching contributions. The formula
contribution is made by the Company and equals 1.5% of total participant
compensation earned during the plan year. The formula contribution is allocated
to participants based on the participants’ compensation earned during the plan
year as a percentage of total plan year compensation.
For
the
profit sharing portion of the Plan, the funding policy is to make annual
investment fund contributions to the Plan in amounts determined by a formula
set
forth in the Plan. The contribution formula is based on 5.5% of the
participants’ total compensation earned during the plan year plus 5.5% of the
participants’ compensation above the Social Security taxable wage base as of the
beginning of the plan year. Investment income is allocated based on
participants’ account balances.
Participant
contributions are made to the profit sharing portion of the
Plan. They consist of salary reduction elections under a 401(k)
feature, voluntary after-tax contributions, and rollover funds from other
qualified plans. The Company is required to make a matching contribution
into
the ESOP portion of the plan equal to 50% of the participants’ contributions to
the Plan not to exceed 2% of the participants’ total compensation
made. That contribution is invested in Company Common
Stock.
Transfers
to/from other funds represent participant elected rollovers to/from plans
of
other employers or other transfers to/from other plans.
(4)
|
Party-in-interest
Transactions
|
JP
Morgan
Retirement Plan Services (Trustee of the Plan) and The Toro Company are
parties-in-interest with respect to the Plan. In the opinion of the Plan’s legal
counsel, certain transactions between the Plan, the Trustee, and the Company
are
exempt from being considered as “prohibited transactions” under ERISA Section
408(b).
THE
TORO COMPANY INVESTMENT,
SAVINGS,
AND
EMPLOYEE STOCK OWNERSHIP
PLAN
Notes
to
Financial
Statements
December
31, 2006 and 2005
(5) Plan
Termination
The
Company has voluntarily agreed to make contributions to the Plan. Although
the
Company has not expressed any intent to terminate the Plan, it may do so
at any
time. Each participant’s interest in the Plan is 100% vested at all times,
except for the portion attributable to matching contributions which is vested
in
a manner described above. Upon termination of the Plan, interests of active
participants in the Plan fully vest.
Under
the
terms of the trust agreement, the Trustee manages investment funds on behalf
of
the Plan. The Trustee has been granted discretionary authority concerning
the
purchases and sales of the investments of the investment funds, except to
the
extent the Trustee is subject to the discretion of participants, other
fiduciaries or the Company. In accordance with the trust agreement, certain
assets of the Plan are held together with assets of other plans sponsored
by the
Company in the Master Trust.
The
net
assets available for benefits of the Master Trust as of December 31, 2006
and 2005 were $86,793,756 and $80,018,240, respectively. All assets of the
Master Trust were held in short-term investment funds.
The
changes in net assets available for benefits of the Master Trust for the
years
ended December 31, 2006 and 2005 were as follows:
|
|
|
|
|
|
|
|
|
2006
|
|
|
2005
|
|
Realized
gain on investments
|
|
$ |
625,159
|
|
|
|
342,341
|
|
Unrealized
gain on investments
|
|
|
3,171,227
|
|
|
|
2,861,851
|
|
Deposits
by participating plans
|
|
|
18,160,080
|
|
|
|
19,104,981
|
|
Withdrawals
by participating plans
|
|
|
(15,180,950 |
) |
|
|
(19,055,998 |
) |
|
|
|
|
|
|
|
|
|
Increase
in net assets
|
|
|
6,775,516
|
|
|
|
3,253,175
|
|
|
|
|
|
|
|
|
|
|
Net
assets available for benefits:
|
|
|
|
|
|
|
|
|
Beginning
of year
|
|
|
80,018,240
|
|
|
|
76,765,065
|
|
|
|
|
|
|
|
|
|
|
End
of year
|
|
$ |
86,793,756
|
|
|
|
80,018,240
|
|
|
|
|
|
|
|
|
|
|
THE
TORO COMPANY INVESTMENT,
SAVINGS,
AND
EMPLOYEE STOCK OWNERSHIP
PLAN
Notes
to
Financial
Statements
December
31, 2006 and 2005
The
following investments represent more than 5% of the Plan’s net assets available
for benefits as of December 31, 2006 and 2005:
|
|
2006
|
|
|
2005
|
|
Growth
Fund of America
|
|
$ |
62,649,042
|
|
|
|
56,368,332
|
|
Vanguard
Institutional Index
|
|
|
37,456,485
|
|
|
|
31,062,763
|
|
American
Century Large Company Value Fund
|
|
|
66,868,298
|
|
|
|
57,941,563
|
|
ICM
Small Company
|
|
|
30,696,096
|
|
|
|
25,006,040
|
|
Fidelity
Diversified International Fund
|
|
|
47,724,396
|
|
|
|
34,135,926
|
|
The
Toro Company Common Stock**
|
|
|
211,063,851
|
|
|
|
219,066,721
|
|
Master
Trust fund
|
|
|
85,386,077
|
|
|
|
78,713,802
|
|
|
|
|
|
|
|
|
|
|
**Party-in-interest,
participant and nonparticipant directed investment
|
|
|
|
|
|
During
2006 and 2005, the Plan’s investments (including gains and losses on investments
bought and sold, as well as held during the year) appreciated in value by
$38,404,540 and $26,907,407, respectively, as follows:
|
|
|
|
|
|
|
|
|
2006
|
|
|
2005
|
|
Mutual
funds
|
|
$ |
23,380,102
|
|
|
|
11,270,293
|
|
The
Toro Company Common Stock
|
|
|
14,193,226
|
|
|
|
15,276,179
|
|
Bond
collective funds
|
|
|
831,212
|
|
|
|
360,935
|
|
|
|
$ |
38,404,540
|
|
|
|
26,907,407
|
|
|
|
|
|
|
|
|
|
|
THE
TORO COMPANY INVESTMENT,
SAVINGS,
AND
EMPLOYEE STOCK OWNERSHIP
PLAN
Notes
to
Financial Statements
December
31, 2006 and 2005
Information
about the net assets and the significant components of the changes in net
assets
relating to the investment in The Toro Company Common Stock is as
follows:
|
|
|
|
|
Non-
|
|
|
|
|
|
|
|
|
|
participant
|
|
|
Participant
|
|
|
|
Total
|
|
|
directed
|
|
|
directed
|
|
|
|
2006
|
|
|
2006
|
|
|
2006
|
|
Net
assets:
|
|
|
|
|
|
|
|
|
|
The
Toro Company Common Stock
|
|
$ |
211,063,851
|
|
|
|
131,906,325
|
|
|
|
79,157,526
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Investment
income:
|
|
|
|
|
|
|
|
|
|
|
|
|
Dividends
|
|
$ |
1,739,003
|
|
|
|
1,076,292
|
|
|
|
662,711
|
|
Net
realized/unrealized gain in the
|
|
|
|
|
|
|
|
|
|
|
|
|
fair
value of investments
|
|
|
14,193,226
|
|
|
|
8,630,823
|
|
|
|
5,562,403
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net
investment income
|
|
|
15,932,229
|
|
|
|
9,707,115
|
|
|
|
6,225,114
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total
contributions
|
|
|
7,190,973
|
|
|
|
5,349,100
|
|
|
|
1,841,873
|
|
Benefit
payments
|
|
|
(12,024,444 |
) |
|
|
(6,316,030 |
) |
|
|
(5,708,414 |
) |
Transfers
to/from other funds
|
|
|
(19,101,628 |
) |
|
|
(10,811,953 |
) |
|
|
(8,289,675 |
) |
|
|
|
|
|
|
|
|
|
|
|
|
|
Decrease
in net assets
|
|
|
|
|
|
|
|
|
|
|
|
|
available
for benefits
|
|
|
(8,002,870 |
) |
|
|
(2,071,768 |
) |
|
|
(5,931,102 |
) |
|
|
|
|
|
|
|
|
|
|
|
|
|
Net
assets available for benefits:
|
|
|
|
|
|
|
|
|
|
|
|
|
Beginning
of year
|
|
|
219,066,721
|
|
|
|
133,978,093
|
|
|
|
85,088,628
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
End
of year
|
|
$ |
211,063,851
|
|
|
|
131,906,325
|
|
|
|
79,157,526
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
THE
TORO COMPANY INVESTMENT,
SAVINGS,
AND
EMPLOYEE STOCK OWNERSHIP
PLAN
Notes
to
Financial
Statements
December
31, 2006 and 2005
|
|
|
|
|
Non-
|
|
|
|
|
|
|
|
|
|
participant
|
|
|
Participant
|
|
|
|
Total
|
|
|
directed
|
|
|
directed
|
|
|
|
2005
|
|
|
2005
|
|
|
2005
|
|
Net
assets:
|
|
|
|
|
|
|
|
|
|
The
Toro Company Common Stock
|
|
$ |
219,066,721
|
|
|
|
133,978,093
|
|
|
|
85,088,628
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Investment
income:
|
|
|
|
|
|
|
|
|
|
|
|
|
Dividends
|
|
$ |
1,266,548
|
|
|
|
774,479
|
|
|
|
492,069
|
|
Net
realized/unrealized gain in the
|
|
|
|
|
|
|
|
|
|
|
|
|
fair
value of investments
|
|
|
15,280,857
|
|
|
|
9,413,770
|
|
|
|
5,867,087
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net
investment income
|
|
|
16,547,405
|
|
|
|
10,188,249
|
|
|
|
6,359,156
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total
contributions
|
|
|
7,264,491
|
|
|
|
5,244,508
|
|
|
|
2,019,983
|
|
Benefit
payments
|
|
|
(8,459,051 |
) |
|
|
(4,921,641 |
) |
|
|
(3,537,410 |
) |
Transfers
to/from other funds
|
|
|
(11,741,602 |
) |
|
|
(9,042,308 |
) |
|
|
(2,699,294 |
) |
|
|
|
|
|
|
|
|
|
|
|
|
|
Increase
in net assets
|
|
|
|
|
|
|
|
|
|
|
|
|
available
for benefits
|
|
|
3,611,243
|
|
|
|
1,468,808
|
|
|
|
2,142,435
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net
assets available for benefits:
|
|
|
|
|
|
|
|
|
|
|
|
|
Beginning
of year
|
|
|
215,455,478
|
|
|
|
132,509,285
|
|
|
|
82,946,193
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
End
of year
|
|
$ |
219,066,721
|
|
|
|
133,978,093
|
|
|
|
85,088,628
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
The
Plan
Administrator has received a determination letter from the Internal Revenue
Service, dated October 23, 2002, stating that the Plan is qualified under
Section 401(a) of the Internal Revenue Code (the Code), and that the trust
created under the Plan is exempt from federal income taxes under Section
501(a)
of the Code. The Plan has been amended since the date of this letter, however
the Plan Administrator believes that the Plan and its related trust continue
to
qualify under the provisions of Sections 401(a) and 501(a) of the Code and
are
exempt from federal income taxes. Therefore, no provision for income taxes
has
been included in the Plan’s financial statements.
THE
TORO COMPANY INVESTMENT,
SAVINGS,
AND
EMPLOYEE STOCK OWNERSHIP
PLAN
Notes
to
Financial
Statements
December
31, 2006 and 2005
The
Plan’s investments are held by JP Morgan Retirement Plan Services (Trustee of
the Plan). Some of the investment funds available to participants also include
mutual funds managed by JP Morgan.
|
(9)
|
Reconciliation
of Differences Between these Financial Statements and the Financial
Information Required on Form
5500:
|
|
|
December
31,
|
|
|
|
2006
|
|
Net
assets available for benefits as presented in these
|
|
|
|
financial
statements
|
|
$ |
606,879,248
|
|
|
|
|
|
|
Adjustment
from contract value to fair value for
|
|
|
|
|
fully
benefit-responsive investment contracts
|
|
|
(1,153,751 |
) |
Adjustment
for employer contribution receivable
|
|
|
(32,843 |
) |
Adjustment
for employee contribution receivable
|
|
|
(47,511 |
) |
|
|
|
|
|
Net
assets available for benefits as presented on Form 5500
|
|
$ |
605,645,143
|
|
|
|
|
|
|
|
|
Year
Ended
|
|
|
|
December
31,
|
|
|
|
2006
|
|
Net
increase in net assets available for benefits as
|
|
|
|
|
presented
in these financial statements
|
|
$ |
50,308,217
|
|
|
|
|
|
|
Adjustment
from contract value to fair value for
|
|
|
|
|
fully
benefit-responsive investment contracts
|
|
|
(1,153,751 |
) |
Adjustment
for employer contribution receivable at December 31, 2006
|
|
|
(32,843 |
) |
Adjustment
for employee contribution receivable at December 31, 2006
|
|
|
(47,511 |
) |
Adjustment
for employer contribution receivable at December 31, 2005
|
|
|
12,963
|
|
Adjustment
for employee contribution receivable at December 31, 2005
|
|
|
44,272
|
|
|
|
|
|
|
Net
increase in net assets available for benefits as
|
|
|
|
|
presented
on Form 5500
|
|
$ |
49,131,347
|
|
|
|
|
|
|
THE
TORO COMPANY INVESTMENT,
SAVINGS,
AND
EMPLOYEE STOCK OWNERSHIP
PLAN
Notes
to
Financial
Statements
December
31, 2006 and 2005
|
|
December
31,
|
|
|
|
2005
|
|
Net
assets available for benefits as presented in these
|
|
|
|
financial
statements
|
|
$ |
556,571,031
|
|
|
|
|
|
|
Adjustment
for employer contribution receivable
|
|
|
(12,963 |
) |
Adjustment
for employee contribution receivable
|
|
|
(44,272 |
) |
|
|
|
|
|
Net
assets available for benefits as presented on Form 5500
|
|
$ |
556,513,796
|
|
|
|
|
|
|
|
|
Year
Ended
|
|
|
|
December
31,
|
|
|
|
2005
|
|
Net
increase in net assets available for benefits as
|
|
|
|
|
presented
in these financial statements
|
|
$ |
40,607,982
|
|
|
|
|
|
|
Adjustment
for employer contribution receivable at December 31, 2005
|
|
|
(12,963 |
) |
Adjustment
for employee contribution receivable at December 31, 2005
|
|
|
(44,272 |
) |
Adjustment
for employer contribution receivable at December 31, 2004
|
|
|
11,312
|
|
Adjustment
for employee contribution receivable at December 31, 2004
|
|
|
40,883
|
|
|
|
|
|
|
Net
increase in net assets available for benefits as
|
|
|
|
|
presented
on Form 5500
|
|
$ |
40,602,942
|
|
|
|
|
|
|
AND
EMPLOYEE STOCK OWNERSHIP
PLAN
Schedule
of Assets (Held at End of the Year)
December
31, 2006
|
|
Face
|
|
|
|
|
|
|
|
|
|
amount
|
|
|
|
|
|
Fair
|
|
Description
|
|
or
shares
|
|
|
Cost***
|
|
|
value
|
|
|
|
|
|
|
|
|
|
|
|
Barclays
Global Investors
|
|
|
1,599,516
|
|
|
|
|
|
$ |
21,643,423
|
|
Artisan
Mid Cap Fund
|
|
|
294,499
|
|
|
|
|
|
|
8,971,299
|
|
JP
Morgan MidCap Value*
|
|
|
530,410
|
|
|
|
|
|
|
13,786,011
|
|
STI
Classics Small Cap Growth Stock Fund
|
|
|
356,310
|
|
|
|
|
|
|
7,171,022
|
|
Fidelity
Diversified International Fund
|
|
|
1,291,403
|
|
|
|
|
|
|
47,724,396
|
|
Growth
Fund of America
|
|
|
1,917,592
|
|
|
|
|
|
|
62,649,042
|
|
ICM
Small Company
|
|
|
821,402
|
|
|
|
|
|
|
30,696,096
|
|
Vanguard
Institutional Index
|
|
|
289,037
|
|
|
|
|
|
|
37,456,485
|
|
American
Century Large Company Value Fund
|
|
|
8,821,675
|
|
|
|
|
|
|
66,868,298
|
|
Loan
Fund
|
|
|
23,871
|
|
|
|
|
|
|
23,871
|
|
The
Toro Company Common Stock**
|
|
|
4,526,353
|
|
|
$ |
55,682,024
|
|
|
|
211,063,851
|
|
Master
Trust fund
|
|
|
86,539,828
|
|
|
|
|
|
|
|
85,386,077
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total
investments
|
|
|
|
|
|
|
|
|
|
$ |
593,439,871
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
*Party-in-interest
|
|
|
|
|
|
|
|
|
|
|
|
|
**Party-in-interest,
participant and nonparticipant directed investment
|
|
|
|
|
|
***
Information not required for participant directed
investments
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
See
accompanying report of independent registered public accounting
firm.
|
|
|
|
|
|
SIGNATURES
|
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.
|
|
The
Toro Company Investment, Savings, and
|
|
Employee
Stock Ownership Plan
|
|
|
Date: June
28, 2007
|
By
/s/ Stephen P. Wolfe
|
|
Stephen
P. Wolfe
|
|
Vice
President Finance
|
|
and
Chief Financial Officer
|
|
of
The Toro Company
|
Exhibit
Index
Exhibit
Number
|
Description
|
23.1
|
Consent of
Independent Registered Public Accounting
Firm
|