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, 2017
[ ]
TRANSITION REPORT PURSUANT TO SECTION 15(d) OF THE SECURITIES
EXCHANGE ACT OF 1934
For the
transition period from_____________ to ______________
Commission
File Number - 333-133631
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A.
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Full
title of the plan and the address of the plan:
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COMMUNITY BANCORP
& DESIGNATED SUBSIDIARIES RETIREMENT SAVINGS PLAN
Physical Location:
4811
U.S. Rte. 5
Derby,
Vermont 05829
Mailing Address:
4811
U.S. Rte. 5
Newport,
Vermont 05855
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B.
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Name of
issuer of the securities held pursuant to the plan and the address
of its principal executive office:
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COMMUNITY
BANCORP.
4811
U.S. Rte. 5
Derby,
Vermont 05829
REQUIRED INFORMATION
The
Community Bancorp and Designated Subsidiaries Retirement Savings
Plan is an ERISA plan with more than 100 participants. Required
financial statements filed with this report:
Financial
Report for plan year ended December 31, 2017.
1
COMMUNITY BANCORP & DESIGNATED
SUBSIDIARIES RETIREMENT SAVINGS PLAN
FINANCIAL STATEMENTS
and
SUPPLEMENTAL INFORMATION
December 31, 2017 and 2016
With Report of Independent Registered Public Accounting
Firm
REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING
FIRM
Plan
Administrator and Audit Committee of the Board of
Directors
Community
Bancorp & Designated Subsidiaries Retirement Savings
Plan
Opinion on the Financial Statements
We have
audited the accompanying statements of net assets available for
benefits of Community Bancorp & Designated Subsidiaries
Retirement Savings Plan (the Plan) as of December 31, 2017 and
2016, and the related statement of changes in net assets available
for benefits for the year ended December 31, 2017, and the related
notes (collectively referred to as the financial statements). In
our opinion, the financial statements present fairly, in all
material respects, the net assets available for benefits of the
Plan as of December 31, 2017 and 2016, and the changes in net
assets available for benefits for the year ended December 31, 2017,
in conformity with accounting principles generally accepted in the
United States of America.
Basis for Opinion
These
financial statements are the responsibility of the Plan’s
management. Our responsibility is to express an opinion on the
Plan’s financial statements based on our audits. We are a
public accounting firm registered with the Public Company
Accounting Oversight Board (United States) (PCAOB) and are required
to be independent with respect to the Plan in accordance with the
U.S. federal securities laws and the applicable rules and
regulations of the Securities and Exchange Commission and the
PCAOB.
We
conducted our audits in accordance with the standards of the PCAOB.
Those standards require that we plan and perform the audit to
obtain reasonable assurance about whether the financial statements
are free of material misstatement, whether due to error or
fraud.
Our
audits included performing procedures to assess the risks of
material misstatement of the financial statements, whether due to
error or fraud, and performing procedures that respond to those
risks. Such procedures included examining, on a test basis,
evidence regarding the amounts and disclosures in the financial
statements. Our audits also included evaluating the accounting
principles used and significant estimates made by management, as
well as evaluating the overall presentation of the financial
statements. We believe that our audits provide a reasonable basis
for our opinion.
Supplemental Information
The
supplemental schedule of assets (held at end of year) as of
December 31, 2017 has been subjected to audit procedures performed
in conjunction with the audit of the Plan's financial statements.
The supplemental information is the responsibility of the
Plan’s management. Our audit procedures included determining
whether the supplemental information reconciles to the financial
statements or the underlying accounting and other records, as
applicable, and performing procedures to test the completeness and
accuracy of the information presented in the supplemental
information. In forming our opinion on the supplemental information
in the accompanying schedule, we evaluated whether the supplemental
information, including its form and content, is presented in
conformity with the Department of Labor's Rules and Regulations for
Reporting and Disclosure under the Employee Retirement Income
Security Act of 1974. In our opinion, the supplemental information
is fairly stated, in all material respects, in relation to the
financial statements as a whole.
We have
served as the Plan’s auditor since 2003.
Portland,
Maine
June
28, 2018
VT Reg.
No. 92-0000278
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COMMUNITY
BANCORP & DESIGNATED
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SUBSIDIARIES
RETIREMENT SAVINGS PLAN
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Statements
of Net Assets Available for Benefits
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December
31,
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2017
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2016
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Assets
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Investments,
at fair value
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Money
market assets
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$1,194,186
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$1,813,136
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Marketable
equity securities
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8,640,314
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7,109,000
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Mutual
funds
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15,080,148
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11,541,376
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Total
investments
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24,914,648
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20,463,512
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Receivables
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Employer
contributions
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428,297
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447,486
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Participant
contributions
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20,040
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18,347
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Participant
loans
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529,329
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487,401
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Accrued
interest and dividends
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1,402
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258
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Total
receivables
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979,068
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953,492
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Net
assets available for benefits
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$25,893,716
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$21,417,004
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The accompanying notes are an integral part of these financial
statements.
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COMMUNITY
BANCORP & DESIGNATED
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SUBSIDIARIES
RETIREMENT SAVINGS PLAN
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Statement
of Changes in Net Assets Available for Benefits
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Year
Ended December 31, 2017
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Additions to net
assets attributed to:
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Investment
and participant loan income
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Net
appreciation in fair value of investments
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$3,074,886
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Interest
and dividends from investments and participant loans
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1,170,943
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4,245,829
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Contributions
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Employer’s
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533,326
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Participants’
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458,549
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Rollovers
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3,671
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995,546
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Total
additions
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5,241,375
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Deductions from net
assets attributed to:
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Benefits
paid to participants
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757,840
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Administrative
expenses
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6,823
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Total
deductions
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764,663
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Increase
in net assets available for benefits
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4,476,712
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Net assets
available for benefits
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Beginning
of year
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21,417,004
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End
of year
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$25,893,716
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The accompanying notes are an integral part of these financial
statements.
COMMUNITY BANCORP & DESIGNATED
SUBSIDIARIES RETIREMENT SAVINGS PLAN
Notes to Financial Statements
December 31, 2017 and 2016
Note
1. Description of Plan
The
following description of the Community Bancorp & Designated
Subsidiaries Retirement Savings Plan (the Plan) provides only
general information. Participants should refer to the Plan
agreement for a more complete description of the Plan's
provisions.
General
The
Plan is a defined contribution plan covering all employees of the
sponsor, Community National Bank (the Bank), a subsidiary of
Community Bancorp. (the Company), who have attained age 21 and have
completed one year of service. Effective January 1, 2008, the Plan
recognized years of service with LyndonBank and affiliated
employers for purposes of eligibility and computing vesting. Under
the provisions of the Plan, investment activity is directed by
individual participants. The Plan is subject to the provisions of
the Employee Retirement Income Security Act of 1974
(ERISA).
Contributions
Participants
may contribute up to the maximum amount allowed by the Internal
Revenue Code (IRC). The Bank makes matching contributions equal to
50% of the participant’s contributions, with such
contributions limited to 5% of annual eligible compensation. The
Bank may also make additional discretionary contributions.
Contributions are subject to certain limitations. After tax or ROTH
contributions are accepted by the Plan.
Forfeiture Accounts
There
were no unallocated forfeitures as of December 31, 2017 and 2016.
Forfeitures may be used to reduce future employer contributions.
During 2017 and 2016, $8,666 and $19,220, respectively, of
forfeitures was used to reduce the Bank’s
contribution.
Note 2. Summary of Accounting Policies
Participant Loans
Loans
to participants are reported at their unpaid principal balances
plus any accrued but unpaid interest. Delinquent participant loans
are reclassified as distributions based upon the terms of the plan
documents.
Effective
January 1, 2016, all new loans made after January 1, 2016 will come
due upon termination of employment.
Investment Valuation
Investments
are reported at fair value. Fair value is the price that would be
received to sell an asset or paid to transfer a liability in an
orderly transaction between market participants at the measurement
date. See Note 3 for discussion of fair value
measurements.
Use of Estimates
The
preparation of financial statements in conformity with U.S.
generally accepted accounting principles requires management to
make estimates and assumptions that affect the reported amounts of
assets and liabilities and disclosure of contingent assets and
liabilities at the date of the financial statements. Actual results
could differ from those estimates.
COMMUNITY BANCORP & DESIGNATED
SUBSIDIARIES RETIREMENT SAVINGS PLAN
Notes to Financial Statements
December 31, 2017 and 2016
Payment of Benefits
Benefits
are recorded when paid.
Administrative Expenses
All
reasonable expenses of administration may be paid out of Plan
assets unless paid by the Bank.
Note 3. Fair Value Measurement
Fair
value measurement accounting literature establishes a fair value
hierarchy that prioritizes the inputs to valuation techniques used
to measure fair value. This hierarchy consists of three broad
levels: Level 1 inputs consist of unadjusted quoted prices in
active markets for identical assets and have the highest priority,
and Level 3 inputs have the lowest priority. The Plan uses
appropriate valuation techniques based on the available inputs to
measure the fair value of its investments. When available, the Plan
measures fair value using Level 1 inputs because they generally
provide the most reliable evidence of fair value. No Level 2 or
Level 3 inputs were used at December 31, 2017 and
2016.
Level 1 Fair Value Measurement
Money
market assets are valued at the net asset value of shares held by
the Plan at year end. The fair value of marketable equity
securities is based on the closing price reported on the active
market where the individual securities are traded. The fair value
of mutual funds is based on quoted net asset values of the shares
held by the Plan at year end.
The
Plan’s investments are reported at fair value on a recurring
basis in the accompanying statements of net assets available for
benefits. The methods used to measure fair value may produce an
amount that may not be indicative of net realizable value or
reflective of future fair values. Furthermore, although the Plan
believes its valuation methods are appropriate and consistent with
other market participants, the use of different methodologies or
assumptions to determine the fair value of certain financial
instruments could result in a different fair value measurement at
the reporting date.
COMMUNITY BANCORP & DESIGNATED
SUBSIDIARIES RETIREMENT SAVINGS PLAN
Notes to Financial Statements
December 31, 2017 and 2016
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Fair
value measurements were as follow:
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Fair
Value Measurement at
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Reporting
Date Using:
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Total
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Level
1
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December
31, 2017
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Money market
assets
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$1,194,186
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$1,194,186
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Marketable equity
securities
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8,640,314
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8,640,314
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Mutual
funds
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15,080,148
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15,080,148
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Total assets at
fair value
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$24,914,648
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$24,914,648
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December
31, 2016
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Money market
assets
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$1,813,136
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$1,813,136
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Marketable equity
securities
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7,109,000
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7,109,000
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Mutual
funds
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11,541,376
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11,541,376
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Total assets at
fair value
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$20,463,512
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$20,463,512
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COMMUNITY BANCORP & DESIGNATED
SUBSIDIARIES RETIREMENT SAVINGS PLAN
Notes to Financial Statements
December 31, 2017 and 2016
Note 4. Tax Status
The
Plan is part of a prototype plan designated by Future Planning
Associates, Inc., the record keeper of the Plan. The Internal
Revenue Service has determined and informed the record keeper by a
letter dated March 31, 2014 that the prototype plan is designed in
accordance with the applicable sections of the IRC. The Plan has
been amended since receiving the opinion letter. However, the plan
administrator and the Plan’s tax counsel believe that the
Plan is currently designed and being operated in compliance with
the applicable requirements of the IRC.
Note 5. Plan Termination
Although
it has not expressed any intention to do so, the Bank has the right
under the Plan to discontinue its contributions at any time and to
terminate the Plan subject to the provisions set forth in ERISA. In
the event of Plan termination, participants would become 100%
vested in their employer contributions.
Note
6. Party-In-Interest Transactions
Community
Financial Services Group, LLC is the Plan’s custodian. The
Bank has a one-third ownership interest in Community Financial
Services Group, LLC. Fees paid to the custodian by the Plan for
investment management services amounted to $3,823 for the year
ended December 31, 2017.
The
Plan allows for participant contributions to be invested in common
stock of the Company. At December 31, 2017 and 2016, the Plan held
467,044 and 462,374 shares of Company common stock, respectively,
valued at $8,640,314 and $7,109,000, respectively.
There
were no party-in-interest transactions which are prohibited by
ERISA Section 406 and for which there is no statutory or
administrative exemption.
Note
7. Risks and Uncertainties
The
Plan invests in various investment securities. Investment
securities are exposed to various risks such as interest rate,
market, and credit risks. Due to the level of risk associated with
certain investment securities, it is at least reasonably possible
that changes in the values of investment securities will occur in
the near term and that such changes could materially affect
participants’ account balances and the amounts reported in
the statement of net assets available for benefits.
Note 8. Subsequent Events
For
purposes of accrual or disclosure in these financial statements,
the Company has evaluated subsequent events through the date of
issuance of these financial statements.
Schedule
COMMUNITY BANCORP & DESIGNATED
SUBSIDIARIES RETIREMENT SAVINGS PLAN
Schedule H, Line 4i – Schedule of Assets (Held at End of
Year)
Required for IRS Form 5500
EIN #03-0288082
Plan #002
December 31, 2017
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(c)
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(b)
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Description
of Investment
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Identity
of Issue,
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Including
Maturity Date,
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(e)
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Borrower,
Lessor,
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Rate of
Interest, Collateral,
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(d)
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Current
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(a)
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or
Similar Party
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Par or
Maturity Value
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Cost
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Value
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Fidelity
Money Market Fund
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Money
Market
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**
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$ 1,175,174
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Federated
Government Obligations Fund
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Money
Market
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**
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19,012
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American
Balanced Fund
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Mutual
Fund
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**
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3,698,254
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Dodge
& Cox Balanced Fund
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Mutual
Fund
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**
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766,362
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Growth
Fund of America, Inc.
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Mutual
Fund
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**
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2,958,183
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T. Rowe
Price Equity Income Fund
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Mutual
Fund
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**
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1,385,032
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Royce
Premier Investment Fund
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Mutual
Fund
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**
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1,277,145
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Vanguard
Total Stock Market Index Fund
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Mutual
Fund
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**
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3,446,188
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Vanguard
Short Term Bond Index Fund
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Mutual
Fund
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**
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220,565
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EuroPacific
Growth Fund
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Mutual
Fund
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**
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1,328,419
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*
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Community
Bancorp.
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Common
Stock
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**
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8,640,314
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Investments
at fair value
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24,914,648
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*
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Participant
loans
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3.28% -
5.25%,
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various
maturities
|
-
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529,329
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$25,443,977
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*
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Indicates
a party-in-interest to the Plan.
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**
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Participant
directed investments, information not required.
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SIGNATURES
The Plan. 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.
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COMMUNITY
BANCORP & DESIGNATED SUBSIDIARIES
|
|
RETIREMENT
SAVINGS PLAN
|
|
DATE: June
28, 2018
|
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/s/
Kathryn M.
Austin
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Kathryn
M. Austin, President & Chief
|
|
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Executive
Officer, Community Bancorp.
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(Plan
Administrator)
|
SECURITIES AND EXCHANGE COMMISSION
Washington,
DC 20549
FORM 11-K
[ X ]
ANNUAL REPORT PURSUANT TO SECTION 15(d) OF THE SECURITIES EXCHANGE
ACT OF 1934
COMMUNITY BANCORP.
EXHIBITS
EXHIBIT
INDEX