UNITED STATES
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 December 31, 2004
OR
[ ] TRANSITION REPORT REQUIRED PURSUANT TO SECTION 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934
For the transition period from ________ to ________.
Commission File Number 1-9065
Ecology and Environment, Inc. 401(k) Plan
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(Full title of the Plan)
368 Pleasant View Drive, Lancaster, New York 14086
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(Address of the Plan)
Ecology and Environment, Inc.
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(Name of issuer of the securities held pursuant to the Plan)
368 Pleasant View Drive, Lancaster, New York 14086
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(Address of principal executive office)
REQUIRED INFORMATION
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ITEM 1. Not applicable.
ITEM 2. Not applicable.
ITEM 3. Not applicable
ITEM 4. FINANCIAL STATEMENTS OF THE PLAN
The Financial Statements of the Ecology and Environment, Inc. 401(k) plan
the "Plan") for the fiscal years ended December 31, 2004 and 2003, together
with the reports of Schneider Downs & Co., Inc. and PricewaterhouseCoopers,
LLP, Independent Registered Public Accounting Firms, are included in this
Annual Report on Form 11-K, and are by specific reference incorporated herein
and filed as a part hereof. The Financial Statements and the Notes thereto
are presented in lieu of the financial statements required by Items 1, 2 and
3 of Form 11-K. The Plan is subject to the requirements of the Employee
Retirement Income Security Act of 1974 (ERISA).
EXHIBIT
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Exhibit Number Description of Exhibit
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23.1 Consent of Schneider Downs & Co. Inc.,
Independent Registered Public
Accounting Firm
23.2 Consent of PricewaterhouseCoopers, LLP,
Independent Registered Public
Accounting Firm
Ecology and Environment, Inc.
401(k) Plan
Index to Financial Statements and Supplemental Schedule
December 31, 2004 and 2003
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Page
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Reports of Independent Registered Public Accounting Firms 1
Financial Statements:
Statements of Net Assets Available for Benefits 2
Statements of Changes in Net Assets Available for Benefits 3
Notes to Financial Statements 4-8
Supplemental Schedule:
Schedule H, line 4i - Schedule of Assets (Held at End of Year) 9
Page 1
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Report of Schneider Downs & Co., Inc.
Independent Registered Public Accounting Firm
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To the Participants and Administrator of the
Ecology and Environment, Inc. 401(k) Plan
Lancaster, New York
We have audited the accompanying statement of net assets available for
benefits of Ecology and Environment, Inc. 401(k) Plan, and the related
statement of changes in net assets available for benefits for the year ended
December 31, 2004 and the supplemental schedule of assets (held at end of
year) as of 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 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. The Plan is not
required to have, nor were we engaged to perform, an audit of its internal
control over financial reporting. Our audit 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 Plan's internal
control over financial reporting. Accordingly, we express no such opinion.
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 accounting
principles generally accepted in the United States of America.
Our audit was 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 year) 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. The supplemental schedule is the
responsibility of the Plan's management. The 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/Schneider Downs & Co., Inc.
Pittsburgh, Pennsylvania
January 19, 2006
Report of Independent Registered Public Accounting Firm
To the Participants and Administrator of the
Ecology and Environment, Inc. 401(k) Plan
In our opinion, the accompanying statement of net assets available for
benefits and the related statement of changes in net assets available for
benefits presents fairly, in all material respects, the net assets available
for benefits of the Ecology and Environment, Inc. 401(k) Plan (the "Plan")
at December 31, 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. 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 of these statements 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,
assessing the accounting principles used and significant estimates made by
management, and evaluating the overall financial statement presentation.
We believe that our audit provides a reasonable basis for our opinion.
/s/PRICEWATERHOUSECOOPERS LLP
Buffalo, New York
December 17, 2004
Page 2
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Ecology and Environment, Inc.
401(k) Plan
Statements of Net Assets Available for Benefits
December 31,
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2004 2003
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Assets
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Investments, at fair value (see Note 5) $19,305,598 $16,520,302
Participant contributions receivable 74,174 79,399
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Total assets $19,379,772 $16,599,701
Liabilities
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Other liabilities 73 ---
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Total liabilities 73 ---
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Net assets available for benefits $19,379,699 $16,599,701
============ ============
See accompanying notes to the financial statements.
Page 3
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Ecology and Environment, Inc.
401(k) Plan
Statements of Changes in Net Assets Available for Benefits
Years Ended December 31,
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2004 2003
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Additions:
Additions to net assets:
Interest $ 15,574 $ 10,881
Dividends 344,389 240,135
Net appreciation in fair value of
investments (see Note 5) 1,512,177 2,759,393
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1,872,140 3,010,409
Contributions:
Participant 2,104,083 1,974,479
Rollovers 197,473 177,518
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2,301,556 2,151,997
Total additions 4,173,696 5,162,406
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Deduction from net assets:
Benefits paid to participants 1,381,094 778,503
Administrative expenses 12,604 26,284
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Total deductions 1,393,698 804,787
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Net increase 2,779,998 4,357,619
Net assets available for benefits:
Beginning of year 16,599,701 12,242,082
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End of year $19,379,699 $16,599,701
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See accompanying notes to the financial statements.
Page 4
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Ecology and Environment, Inc.
401(k) Plan
Notes to Financial Statements
December 31, 2004 and 2003
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1. Description of Plan
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The following description of the Ecology and Environment 401(k) Plan
(the Plan) is provided for general information purposes only. Participants
should refer to the Plan agreement for a more comprehensive description of
the Plan's provisions. On August 1, 2002, the Plan changed the Recordkeeper
from Dreyfus Retirement Services (Dreyfus) to MFS Retirement Services, Inc.
(MFS) and changed the Trustee from Dreyfus to Reliance Trust Company. In
connection with these changes, a new plan agreement was adopted on August 1,
2002.
General
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The Plan was established January 1, 1994 as a defined-contribution plan
to cover all eligible employees of Ecology and Environment, Inc. (the
Company). Beginning August 1, 2002 the hours of service requirement was
eliminated and employees age twenty-one or older are immediately eligible to
participate in the plan during the month following their date of hire.
Contributions to the Plan were not permitted prior to July 1, 1994. The Plan
is subject to the provisions of the Employee Retirement Income Security Act
of 1974.
Contributions
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Participants may elect to make voluntary contributions subject only to
the limitations of the Internal Revenue Code. The elective deferral
percentage may be modified the first day of any month. Upon enrollment in
the Plan, a participant may direct their contributions in any combination of
the seventeen investment options in at least 10 percent increments in each
option selected.
The Company may make contributions in the form of matching contributions
and/or an annual discretionary contribution fixed by appropriate action of
the Company. There were no Company contributions for the 2004 and 2003 plan
years.
Participant accounts
--------------------
Each participant's account is credited with the participant's
contribution and allocations of the Company's contribution (if any) and
the Plan earnings, and charged with an allocation of administrative expenses.
Allocations are based on participant account balances, as defined in the
Plan documents. The benefit to which a participant is entitled is the
participant's vested account balance.
Vesting
-------
Participants are immediately vested in their contributions plus actual
earnings thereon. Vesting in the Company's matching and discretionary
contribution portion of their accounts plus actual earnings thereon is based
on years of continuous service. A participant is 100% vested in the Company
contributions after five years of credited service. There is no partial
vesting.
Page 5
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Participant loans
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Participants may borrow from their account a minimum of $1,000 with a
maximum equal to the lesser of $50,000 or 50% of their vested account
balance. Loan transfers are treated as a transfer to (from) the investment
fund from (to) the Loan Fund. Loan terms range from one to five years or a
reasonable period of time determined when the loan is made for the purchase
of a primary residence. The loans are collateralized by the balance in the
participant's account and bear interest at a rate commensurate with local
prevailing rates as determined by the Plan Administrator. Principal and
interest are paid ratably through bi-weekly payroll deductions.
Payment of benefits
-------------------
On termination of service due to death, disability, or retirement, a
participant may elect to receive either a lump-sum amount equal to the value
of the participant's vested interest in his or her account, or monthly,
quarterly, semi-annual or annual installments over a period not to exceed
the life of the participant or the life of a designated beneficiary.
Administration
--------------
The Plan is administered by the Company. The Company has selected MFS
to be the Recordkeeper of the Plan and Reliance Trust Company as the Trustee.
Administrative expenses are paid by the participants and the Company.
An asset-based fee is paid by the participants on an annual basis. This
amount is deducted from participant accounts and placed in a holding
account, which is merged with the MFS Fixed Fund. Any remaining
administrative expenses in excess of the amounts which are set aside by the
Plan are paid by the Company.
2. Summary of Accounting Policies
------------------------------
Basis of Accounting:
The financial statements of the Plan are prepared under the accrual
method of accounting.
Investments and Related Transactions:
The Plan's investments are reflected at current market value as measured
by quoted market prices in an active market or as determined in good faith
by the Trustee. Shares of mutual funds are valued at the net asset value of
shares held by the Plan at year-end. Net appreciation/(depreciation) in fair
value of investments includes both realized gains and losses and unrealized
appreciation/(depreciation). Interest and dividend income is recognized as
earned. Investment transactions are accounting for on the trade date.
Participant loans are valued at cost, which approximates fair value.
Page 6
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Payment of Benefits:
Benefits are recorded when paid.
Use of Estimates:
The preparation of the Plan's financial statements in conformity with
generally accepted accounting principles requires the Plan Administrator to
make estimates and assumptions that affect the reported amounts of net
assets and disclosures of contingent net assets at the date of the financial
statements and the reported amounts of changes in net assets during the
reporting period. Actual results could differ from those estimates.
Reclassifications:
Certain 2003 amounts have been reclassified to conform to the 2004
presentation.
3. Plan Termination
----------------
Although it has not expressed any intent to do so, the Company has the
right under the Plan to discontinue at any time and to terminate the Plan
subject to the provisions of ERISA. In the event of Plan termination,
participants will become 100 percent vested in their accounts.
4. Tax Status
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The Plan Administrator has not applied to the Internal Revenue Service
for a determination letter for the Plan. The Plan was based upon a prototype
plan designed by MFS Retirement Services, Inc. and received a favorable
determination letter dated April 23, 2002. The Plan has been amended since
receiving the determination letter. However, the Plan Administrator and the
Plan's legal counsel believe that the Plan is currently designed and being
operated in compliance with the applicable requirements of the Internal
Revenue Code. Therefore, no provision for income taxes has been included in
the Plan's financial statements.
Page 7
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5. Investments
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The following presents investments that represent five percent or more
of the Plan's net assets at December 31, 2004 and 2003:
2004 2003
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MFS Mid Cap Growth Fund,
394,004 and 399,082 shares, respectively $ 3,522,397 $ 3,116,833
Scudder Equity 500 Index Fund
25,423 and 0 shares, respectively 3,449,887 ---
MFS Value Fund, 142,707 and 133,750 shares,
respectively 3,302,239 2,720,481
MFS Fixed Fund - Institutional, 2,290,818
and 2,134,192 shares, respectively 2,290,818 2,134,192
MFS Core Growth Fund, 102,642 and 118,379
shares, respectively 1,695,641 1,774,498
MFS Research Bond Fund, 112,680 and 99,923
shares, respectively 1,178,629 1,050,196
Fidelity Low Price Stock Fund, 25,348 and
14,990 shares, respectively 1,020,238 524,345*
Barclays S&P 500 Stock Fund, 0 and 24,199
shares, respectively --- * 3,260,527
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Total of investments representing 5 percent
or more of the Plan's net assets 16,459,849 14,581,072
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Participant loan, 5.00% - 10.50% 269,308 253,604
Ecology and Environment, Inc. Common Stock,
29,205 and 25,130 shares, respectively 229,259 245,018
Other 2,347,182 1,440,608
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Total investments $19,305,598 $16,520,302
============ ============
* Less than 5%, presented for comparative purposes.
The Plan's investments for the years ended December 31, 2004 and 2003
(including gains and losses on investments bought and sold, as well as held
during the year) appreciated (depreciated) in value as follows:
2004 2003
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Mutual funds $ 1,560,043 $ 2,665,316
Ecology and Environment, Inc Common Stock (47,866) 94,077
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$ 1,512,177 $ 2,759,393
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Page 8
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6. Transactions with Parties-in-Interest
As of December 31, 2004 and 2003, the Plan held certain securities
issued by the Company as follows:
December 31, 2004 December 31, 2003
Number of Fair Number of Fair
shares value shares value
--------------------- ---------------------
Ecology and Environment, Inc.
Common Stock 29,205 $ 229,259 25,130 $ 245,018
Certain plan investments are shares of mutual funds and pooled separate
accounts offered by MFS Retirement Services, Inc. (MFS). MFS is also
recordkeeper of the plan and custodian of all investments other than Company
stock. As of December 31, 2004 and 2003, the Plan held the following
investments offered by MFS:
December 31, 2004 December 31, 2003
Number of Fair Number of Fair
shares value shares value
--------------------- ---------------------
Mid Cap Growth Fund 394,004 $3,522,397 399,082 $3,116,833
Value Fund 142,707 3,302,239 133,750 2,720,481
Fixed Fund - Institutional 2,290,818 2,290,818 2,134,192 2,134,192
Core Growth Fund 102,642 1,695,641 118,379 1,774,498
Research Bond Fund 112,680 1,178,629 99,923 1,050,196
Total Return Fund 30,043 480,684 26,423 398,989
Aggressive Growth Allocation
Fund 14,622 196,516 5,574 65,723
New Discovery Fund 9,868 161,828 9,301 142,776
Growth Allocation Fund 7,620 99,827 1,301 15,210
Moderate Allocation Fund 7,681 94,478 309 3,490
Money Market 57,645 57,645 79,399 79,399
Consecutive Allocation Fund 1,668 18,998 797 8,628
During the years ended December 31, 2004 and 2003 the Plan's investments with
MFS (including gains and losses on investments bought and sold, as well as
held during the year) appreciated in value by $1,053,061 and $1,774,131,
respectively.
Page 9
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Ecology and Environment, Inc.
401(k) Plan
EIN: 16-0971022
Plan Number: 003
Schedule H - line 4i - Schedule of Assets (Held at End of Year)
---------------------------------------------------------------
(c) Description of
(b)Identity of Investment Including
Issue Borrow, Maturity Date,
Lessor or Collateral, Par, or (e) Current
(a) Shares Similar Party Maturity Value (d) Cost Value
------ ---------------- ------------------------ -------- -----------
MFS Retirement Services, Inc.
-----------------------------
* 394,004 MFS Mid Cap Growth Fund ** $ 3,522,397
* 142,707 MFS Value Fund ** 3,302,239
* 2,290,818 MFS Fixed Fund - Institutional ** 2,290,818
* 102,642 MFS Core Growth Fund ** 1,695,641
* 112,680 MFS Research Bond Fund ** 1,178,629
* 30,043 MFS Total Return Fund ** 480,684
* 14,622 MFS Aggressive Growth Allocation Fund ** 196,516
* 9,868 MFS New Discovery Fund ** 161,828
* 7,620 MFS Growth Allocation Fund ** 99,827
* 7,681 MFS Moderate Allocation ** 94,478
* 57 645 MFS Money Market ** 57,645
* 1,668 MFS Conservative Allocation Fund ** 18,998
-----------
13,099,700
Other Investments:
------------------
25,423 Scudder Equity 500 Index Fund ** 3,449,887
68,148 Templeton Foreign Fund ** 838,218
25,348 Fidelity Low Price Stock Fund ** 1,020,238
* 29,205 Ecology and
Environment, Inc. Common Stock ** 229,259
* --- Participant Loans (5.00% - 10.50%) -0- 269,308
287,741 --- Brokerage Access Account ** 287,741
3,766 Domini Social Equity Fund ** lll,247
-----------
$19,305,598
===========
* Indicates parties-in-interest to the Plan
** Cost is not required to be presented for participant directed investments.
SIGNATURE
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The Plan. Pursuant to the requirements of the Securities Exchange Act of
1934, the Plan Administrator has duly caused this annual report to be signed
by the undersigned thereunto duly authorized.
Ecology and Environment, Inc.
401(k) Plan
-----------------------------
(Name of Plan)
By: Ecology and Environment, Inc.
401(k) Plan Committee
Plan Administrator
By: /s/RONALD L. FRANK
-----------------------------
RONALD L. FRANK
COMMITTEE MEMBER
DATE: March 10, 2006