UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
Pursuant to Section 15(d) of the
Securities Exchange Act of 1934
For the fiscal year ended December 31, 2002
Commission File Number l-8610
175 E. Houston, San Antonio, Texas 78205
Financial Statements, Supplemental Schedules and Exhibits
Table of Contents
Page
Report of Independent Auditors....................................................................................1
Financial Statements:
Statements of Net Assets Available for Benefits as of December 31, 2002 and 2001....................... 2
Statement of Changes in Net Assets Available for Benefits for the
Year Ended December 31, 2002........................................................................... 3
Notes to Financial Statements.......................................................................... 4
Supplemental Schedules:
Schedule G, Part III - Schedule of Nonexempt Transactions.............................................. 8
Schedule H, Line 4i - Schedule of Assets (Held at End of Year)......................................... 9
Exhibits:
23 - Consent of Ernst & Young LLP
99 - Certification of Periodic Financial Reports
REPORT OF INDEPENDENT AUDITORS
SBC Communications Inc., Plan Administrator
for the SBC Savings and Security Plan
We have audited the accompanying statements of net assets available for benefits of SBC Savings and Security Plan
as of December 31, 2002 and 2001, and the related statement of changes in net assets available for benefits for the
year ended December 31, 2002. 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 auditing standards generally accepted in the 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 at December 31, 2002 and 2001, and the changes in its net assets available for benefits for
the year ended December 31, 2002, in conformity with accounting principles generally accepted in the United States.
Our audits were performed for the purpose of forming an opinion on the financial statements taken as a whole. The
accompanying supplemental schedules of assets (held at end of year) as of December 31, 2002 and nonexempt
transactions for the year then ended are presented for purposes of additional analysis and are not a required part
of the financial statements but are 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. These
supplemental schedules are the responsibility of the Plan's management. The supplemental schedules have been
subjected to auditing procedures applied in our audits of the financial statements, and in our opinion, are fairly
stated in all material respects in relation to the financial statements taken as a whole.
/s/ ERNST & YOUNG LLP
San Antonio, Texas
June 23, 2003
SBC SAVINGS AND SECURITY PLAN
STATEMENTS OF NET ASSETS AVAILABLE FOR BENEFITS
(Dollars in Thousands)
December 31,
---------------------------------------
2002 2001
--------------- ----------------
ASSETS
Investments (See Note 3) $ 4,471,815 $ 3,999,240
Cash - 115
Dividends and interest receivable 65 116
Receivable for investments sold 55 371
Contributions receivable 45 -
Other receivables - 73
--------------- ----------------
Total Assets 4,471,980 3,999,915
--------------- ----------------
LIABILITIES
Administrative expenses payable 526 1,408
Payable for investments purchased 3,241 -
--------------- ----------------
Total Liabilities 3,767 1,408
--------------- ----------------
Net Assets Available for Benefits $ 4,468,213 $ 3,998,507
=============== ================
See Notes to Financial Statements.
SBC SAVINGS AND SECURITY PLAN
STATEMENT OF CHANGES IN NET ASSETS AVAILABLE FOR BENEFITS
FOR THE YEAR ENDED DECEMBER 31, 2002
(Dollars in Thousands)
Net Assets Available for Benefits, December 31, 2001 $ 3,998,507
Additions to Net Assets:
Contributions and transfers:
Participant contributions 243,236
Employer contributions 126,355
Transfer in due to plan merger (See Note 1) 1,425,486
---------------
1,795,077
Investment Income:
Dividends on SBC common shares 76,302
Interest 46,516
---------------
122,818
---------------
Total Net Additions 1,917,895
Deductions from Net Assets:
Net depreciation in fair value of investments 798,840
Administrative expenses 6,184
Distributions 638,486
Transfer to other plan (See Note 1) 4,679
---------------
Total Deductions 1,448,189
---------------
Net Assets Available for Benefits, December 31, 2002 $ 4,468,213
===============
See Notes to Financial Statements.
SBC SAVINGS AND SECURITY PLAN
NOTES TO FINANCIAL STATEMENTS
(Dollars in Thousands)
1. Plan Description - The SBC Savings and Security Plan (Plan) was established by SBC Communications Inc. (SBC or
----------------
the Company) to provide a convenient way for eligible employees to save for retirement on a regular and
long-term basis. The majority of eligible employees are represented by the Communications Workers of
America. The following description of the Plan provides only general information. The Plan has detailed
provisions covering participant eligibility, participant allotments from pay, participant withdrawals,
participant loans, employer contributions and related vesting of contributions and Plan expenses. The Plan
text and prospectus include complete descriptions of these and other Plan provisions. The Plan is subject to
the provisions of the Employee Retirement Income Security Act of 1974 (ERISA).
Effective September 2, 2002, the Ameritech Savings Plan for Non-Salaried Employees was merged into the Plan.
Approximately $1,425,486 from this merger is included on the statement of changes in net assets available for
benefits.
In 2000, SBC entered into the Cingular Wireless (Cingular) joint venture agreement with BellSouth Corporation.
As a result of this agreement, certain SBC employees were leased to Cingular. In December 2001 these employees
became Cingular employees. During 2002 the Plan transferred approximately $4,679 to State Street Bank and
Trust related to those former employees who became employees of Cingular.
Participants can invest their contributions in one or more of the following funds in 1% increments: the SBC
Shares Fund, the Bond Fund, the Large Cap Stock Fund (formerly known as the Diversified Equity Portfolio), the
Interest Income Fund, the Asset Allocation Fund, the Global Equity Fund, the Mid and Small Cap Stock Fund and
the International Stock Fund.
Company matching contributions are made solely in the form of shares of SBC's common stock held in an Employee
Stock Ownership Plan (ESOP) which is a separate investment account of this Plan.
Dividends on shares in the SBC Shares Fund and the ESOP can either be reinvested in the SBC Shares Fund on a
quarterly basis, or paid into a separate fund known as a Dividend Fund Account (DFA) for distribution at the
end of the year. At the end of the year, dividends held in the DFA are paid out to the participant. Interest
earned on dividends held in the DFA will be paid into the SBC Shares Fund. During 2002, Plan participants
elected to receive $16,615 in dividend distributions. This amount is included in distributions on the
statement of changes in net assets.
Although it has not expressed any intent to do so, SBC has the right under the Plan to discontinue its
contributions at any time and to terminate the Plan subject to the provisions of ERISA. In the event that the
Plan is terminated, subject to the conditions set forth by ERISA, the account balances of all participants
shall be 100% vested.
2. Accounting Policies - The values of investments are determined as follows: SBC common shares on the basis of
-------------------
the closing price as reported on the New York Stock Exchange; contracts with insurance companies and other
financial institutions at principal plus reinvested interest which approximates fair value; common collective
trust funds at values obtained from fund managers; and temporary cash investments at cost, which approximates
fair value. Purchases and sales of securities are reflected as of the trade date. Dividend income is
recognized on the ex-dividend date. Interest earned on investments is recognized on the accrual basis.
The accompanying financial statements were prepared in conformity with accounting principles generally
accepted in the United States, which require management to make estimates that affect the amounts reported in
the financial statements and accompanying notes. Actual results could differ from those estimates.
3. Investments - Investments representing 5% or more of Plan net assets at either December 31, 2002 or 2001 were:
-----------
2002 2001
-------------- -------------
Employee Stock Ownership Plan *
-------------------------------
SBC common shares $ 1,012,278 $ 1,028,969
SBC Shares Fund
---------------
SBC common shares $ 1,581,928 $ 1,530,316
Large Cap Stock Fund
--------------------
Barclays Global Investors Equity Index Fund F $ 399,612 $ 434,521
* Nonparticipant-directed
During 2002, the Plan's investments (including gains and losses on investments bought and sold, as well as
held during the year) depreciated in value as follows:
Common Stock $ (671,360)
Common Collective Trusts (127,480)
-------------
Total $ (798,840)
=============
The Interest Income Fund consists of contracts with various financial institutions and insurance companies
that promise to repay principal plus accrued income at contract maturity, subject to the creditworthiness of
the issuer. Interest crediting rates are generally established when the contract is purchased and are not
reset. For the years ended December 31, 2002 and 2001, the average interest rates earned on these contracts
were 5.39% and 6.13%. At December 31, 2002, the fixed crediting interest rates on these contracts ranged from
2.83% to 8.00%. At December 31, 2001, the fixed crediting interest rates on these contracts ranged from 3.76%
to 8.00%. No valuation reserves were recorded to adjust contract amounts as of December 31, 2002 or 2001.
The Interest Income Fund invests in both guaranteed investment contracts (GICs) and synthetic investment
contracts (SICs). SICs differ from GICs in that the assets supporting the SICs are owned by the Plan. A bank
or insurance company issues a wrapper contract that allows participant directed transactions to be made at
contract value. Wrapper contracts are valued as the difference between the fair value of the supporting assets
and the contract value. The assets supporting the GICs and SICs generally consist of high quality fixed income
securities with a fair value of $777,862 and $413,798 at December 31, 2002 and 2001.
The Plan provides for investments in various investment securities, which in general, are exposed to various
risks, such as interest rate, credit, and overall market volatility risks. Due to the level of risk associated
with certain investment securities, it is reasonably possible that changes in the values of investment
securities will occur in the near term and that such change could materially affect the amounts reported in the
statements of net assets available for benefits and participant account balances.
4. Nonparticipant-Directed Investments - Information about the net assets and the significant components of the
-----------------------------------
changes in net assets relating to the nonparticipant-directed investments as of December 31 is as follows:
2002 2001
------------- -------------
Assets
------
SBC common shares $ 1,012,278 $ 1,028,969
Temporary cash investments 4,366 2,958
Dividends and interest receivable 3 3
Receivable for investments sold 55 371
Other receivables - 1
------------- -------------
Total Assets 1,016,702 1,032,302
------------- -------------
Liabilities
-----------
Administrative expenses payable 55 368
Payable for investments purchased 3,241 -
------------- -------------
Total Liabilities 3,296 368
------------- -------------
Net Assets Available for Benefits $ 1,013,406 $ 1,031,934
============= =============
2002
-------------
Net Assets Available for Benefits, December 31, 2001 $ 1,031,934
Employer contributions 126,355
Transfer in due to plan merger 288,491
Interest income 24
Dividends 57
Net depreciation in fair value of investments (279,998)
Administrative expenses (1,557)
Distributions (150,619)
Transfer to other plan (1,281)
-------------
(18,528)
-------------
Net Assets Available for Benefits, December 31, 2002 $ 1,013,406
=============
5. Tax Status - The Plan has received a determination letter from the Internal Revenue Service dated March
----------
10, 1997, stating that the Plan is qualified under Section 401(a) of the Internal Revenue Code (IRC) and,
therefore, the related trust is exempt from taxation. Once qualified, the Plan is required to operate in
conformity with the IRC to maintain its qualification. The plan sponsor has indicated that it will take the
necessary steps, if any, to maintain the Plan's qualified status.
On February 28, 2002, the Plan filed for, but has not yet received, a new tax determination letter from the
IRS to reflect legally required changes and other changes made to the Plan since the previous determination
letter was issued.
6. Reconciliation of Financial Statements to Form 5500 - The following is a reconciliation of Net Assets
---------------------------------------------------
Available for Benefits per the financial statements to the Form 5500 as of December 31:
2002 2001
--------------- --------------
Net Assets Available for Benefits per the financial statements $ 4,468,213 $ 3,998,507
Less: Distribution payable to participants (3,670) (369)
--------------- --------------
--------------- --------------
Net Assets Available for Benefits per the Form 5500 $ 4,464,543 $ 3,998,138
=============== ==============
The following is a reconciliation of benefits paid to participants per the financial statements to the
Form 5500 for the year ended December 31, 2002:
2002
--------------
Distributions to participants per the financial statements 638,486 $
Add: Distributions payable to participants at December 31, 2002 3,670
Less: Distributions payable to participants at December 31, 2001 (369)
--------------
Distributions to participants per the Form 5500 641,787 $
==============
Distributions payable to participants are recorded on the Form 5500 for benefit claims that have been
processed and approved for payment prior to December 31, but not yet paid as of that date.
SBC SAVINGS AND SECURITY PLAN
EIN 43-1301883, PLAN NO. 004
SCHEDULE G, PART III - SCHEDULE OF NONEXEMPT TRANSACTIONS
December 31, 2002
(b)
Relationship to Plan, (j) Net Gain
(a) Employer, or Other (c) (h) (i) Current (repaid
Identity of Party Involved Party-In-Interest Description of Transactions Cost of Asset Value of Asset earnings)*
------------------------------- -------------------------- ----------------------------------------------- ----------------- ---------------- ----------------
SBC Communications Inc. Employer/Plan Sponsor Failure to timely remit participant deferrals
for the pay period(s) ended:
December 29, 2001 $ 876 $ 1,001 $ 125
June 1, 2002 1,610 1,873 263
November 23, 2002 100 118 18
December 1, 2002 330 396 66
* The earnings will be repaid to the Plan during 2003.
Note: Columns (d) - (g) are not shown as they are not applicable.
SBC SAVINGS AND SECURITY PLAN
EIN 43-1301883, PLAN NO. 004
SCHEDULE H, LINE 4i - SCHEDULE OF ASSETS (HELD AT END OF YEAR)
December 31, 2002
(Dollars in Thousands)
Description of Current
Identity of Issue Investment Cost Value
---------------------------------------------------- ------------------------------ ----------- ------------
Employee Stock Ownership Plan
-----------------------------
* SBC common shares 37,339,635 shares $ 800,395 $ 1,012,278
* Boston Safe Deposit and Trust Company Temporary cash investment 4,366 4,366
----------- ------------
Total Employee Stock Ownership Plan 804,761 1,016,644
----------- ------------
SBC Shares Fund
---------------
* SBC common shares 58,352,204 shares 1,581,928
* Boston Safe Deposit and Trust Company Temporary cash investment 14,095
------------
Total SBC Shares Fund ** 1,596,023
------------
Bond Fund
---------
* Barclays Global Investors Intermediate
-------------
Government/Credit Bond Index Fund F 8,615,304 units ** 133,365
-------------
Large Cap Stock Fund
--------------------
------------
* Barclays Global Investors Equity Index Fund F 33,468,312 units ** 399,612
------------
Interest Income Fund
--------------------
Allstate Life Insurance Company Synthetic contract wrapper
#77079, 6.64%,*** (260)
INVESCO Group Trust Group Trust: Lambda 4,062
------------
3,802
------------
------------
Allstate Life Insurance Company 7.10% 12,830
------------
Bank of America National Association Synthetic contract wrapper
#99-086, 5.32%, *** (4,473)
Capital Auto Rec Asset Trust Prime Auto 2,082
Capital Auto Rec Asset Trust Prime Auto 4,109
Capital Auto Rec Asset Trust Prime Auto 4,049
Chase Manhattan Auto Owner Trust Prime Auto 3,569
Federal Home Loan Mortgage Corporation Agency Debenture 17,020
Providian Master Trust Monoline Credit Card 2,297
Capital One Master Trust Monoline Credit Card 2,795
Capital One Master Trust Monoline Credit Card 7,380
Federal Home Loan Mortgage Company Agency Debenture 12,770
Prime Credit Card Master Trust Retail Credit Card 5,500
Fannie Mae Whole Loan PAC 4,573
Credit Suisse First Boston Conduit 5,414
Nordstrom Private Label Credit Card Master Retail Credit Card 5,304
Commercial Mortgage Asset Trust Conduit 4,126
TIAA Cref Conduit 3,470
Union Acceptance Corp Sub Prime Auto 2,158
SBC SAVINGS AND SECURITY PLAN
EIN 43-1301883, PLAN NO. 004
SCHEDULE H, LINE 4i - SCHEDULE OF ASSETS (HELD AT END OF YEAR) - (Continued)
December 31, 2002
(Dollars in Thousands)
Description of Current
Identity of Issue Investment Cost Value
---------------------------------------------------- ------------------------------ ------------ ------------
United States Treasury Treasury Note 16,689
WFS Financial Owners Trust Sub Prime Auto 3,204
Fannie Mae Whole Loan FHA/VA Reperforming Pas 2,208
Household Private Lab MT 2 Retail Credit Card 5,362
Bank of America National Association Cash on Hand 1,205
------------
110,811
------------
Business Men's Assurance Company of
------------
America 5.75% - 7.44%, 7/29/03 9,076
------------
CDC Financial Products Inc. 5.38% - 7.01%,
------------
8/29/05 - 10/17/05 10,107
------------
JP Morgan Chase Bank Synthetic contract wrapper
#401792-L2, 6.26%, *** (148)
INVESCO Group Trust for Retirement Sav. Group Trust: Lambda II 2,413
------------
2,265
------------
JP Morgan Chase Bank Synthetic contract wrapper
#426424-T, 5.12%, *** (6,276)
Federal Home Loan Mortgage Company Agency Debenture 15,546
United States Treasury Treasury Note 3,806
American Express Credit Account Monoline Credit Card 3,386
Fleet Credit Card Master Trust Bank Credit Card 2,898
CIT Equipment Collateral Small Equipment Lease 6,714
AmeriCredit Automobile Receivables Trust Sub Prime Auto 7,415
Credit Suisse First Boston Mortgage Sec. Conduit 5,477
Nissan Auto Receivables Owners Trust Prime Auto 5,620
Ford Credit Auto Owners Trust Prime Auto 593
Ford Credit Auto Owners Trust Prime Auto 4,069
Ford Credit Auto Owners Trust Prime Auto 5,601
Capital One Master Trust Monoline Credit Card 1,049
Citibank Credit Card Bank Credit Card 2,087
Citibank Credit Card Bank Credit Card 5,288
Federal Home Loan Mortgage Company Agency Debenture 2,250
Federal Home Loan Mortgage Company Agency Debenture 1,533
Fannie Mae Whole Loan FHA/VA Reperforming Pass 2,092
Fannie Mae Whole Loan Agency Debenture 9,228
Copelco Capital Fund Corporation Small Equipment Lease 2,914
Daimler Chrysler Prime Auto 1,972
Fannie Mae Whole Loan FHA/VA Reperforming Pass 1,693
Household Private Lab MT 2 Retail Credit Card 4,290
LB Commercial Conduit Mrtg Tr Conduit 5,052
National City Auto Rec Tr Prime Auto 4,123
Sears Credit Account Trust Retail Credit Card 3,769
WFS Financial Owners Trust Sub Prime Auto 3,939
Chase Manhattan Credit Card Master Trust Bank Credit Card 3,919
Honda Auto Receivables Owner Trust Prime Auto 3,642
Caterpillar Financial Asset Trust Large Equipment Loan 2,778
Fannie Mae Whole Loan FHA/VA Reperforming Pass 1,912
JP Morgan Chase Bank Cash on Hand 476
------------
118,855
------------
Description of Current
Identity of Issue Investment Cost Value
---------------------------------------------------- ------------------------------- ----------- ------------
Continental Assurance Company Synthetic contract wrapper
#63005611, 5.76%, *** (240)
INVESCO Group Trust for Retirement Savings Group Trust Beta 6,568
------------
6,328
------------
GE Life and Annuity Assurance Company 7.45% - 8.00%,
------------
12/17/01 - 7/7/04 3,465
------------
------------
------------
Jackson National Life Insurance Company 7.50%, 1/5/04 8,686
------------
John Hancock Life Insurance Company 2.83% - 6.28%,
------------
2/1/02 - 2/3/03 14,069
------------
Metropolitan Life Insurance Company 5.25% - 6.99%,
------------
4/1/02 - 5/13/02 4,621
------------
Metropolitan Life Insurance Company Synthetic Contract Wrapper
#28434, 5.60%, *** (2,607)
Capital Auto Rec Asset Trust Prime Auto 2,054
Carmax Auto Owner Trust Non Prime Auto 1,440
Commercial Mortgage Asset Trust Conduit 4,126
Federal Home Loan Mortgage Company Agency Debenture 1,379
Fannie Mae Whole Loan Agency Debenture 7,740
Fannie Mae Whole Loan Multifamily Balloon 5,729
Fleet Credit Card MT Bank Credit Card 3,901
Honda Auto Receivables Prime Auto 3,642
Household Auto Trust Sub Prime Auto 1,445
MBNA Master Trust Monoline Credit Card 1,670
Nissan Auto Owners Trust Prime Auto 3,122
Toyota Auto Receivable Owner Trust Prime Auto 4,868
Union Acceptance Corporation Sub Prime Auto 3,462
United States Treasury Treasury Note 2,936
United States Treasury Treasury Note 8,901
WFS Financial Owners Trust Sub Prime Auto 3,939
Metropolitan Life Insurance Cash on Hand 228
------------
57,975
------------
------------
Monumental Life Insurance Company 7.08% - 7.25%, 7/25/05 9,907
------------
Monumental Life Insurance Company Synthetic contract wrapper
#00292TR, 5.00%, *** (5,401)
CIT Equipment Collateral Small Equipment Lease 1,678
Capital Auto Receivable Asset Trust Prime Auto 2,082
COAFT Sub Prime Auto 1,969
Carmax Auto Owner Trust Non Prime Auto 3,599
Discover Card Trust Bank Credit Card 7,573
FSPC ABS- Home Equity Agency 3,031
Fannie Mae Whole Loan FHA/VA Reperforming Pass 3,486
Household Automotive Trust Sub Prime Auto 7,691
Home Ownership Fund Corporation Step Down Preferred 1,859
Description of Current
Identity of Issue Investment Cost Value
---------------------------------------------------- ------------------------------- ----------- ------------
Home Ownership Fund Corporation Step Down Preferred 1,550
MBNA Master Trust Monoline Credit Card 4,315
Nissan Auto Owners Trust Prime Auto 1,466
Federal Home Loan Mortgage Corporation Agency Debenture 2,221
United States Treasury Treasury Note 8,156
BOIT Bank Credit Card 9,325
First USA Credit Card Master Trust Bank Credit Card 1,043
Prudential Securities Secured Financing Conduit 2,919
Structured Asset Securities Corp AB SBA Loan PT 6,502
Vanderbilt Mortgage Finance Manufactured Housing 2,386
American Express Credit Account Master Monoline Credit Card 880
Federal Home Loan Mortgage Corporation Agency Debenture 16,871
Pinnacle CBO FSA Insured Cash Flow CBO 2,763
Residential Asset Mtg Product ABS--Home Equity Agency 4,023
Residential Asset Securities Corporation Home Equity Monoline 4,698
Onyx Acceptance Grantor Trust Sub Prime Auto 136
AmeriCredit Automobile Receivables Trust Sub Prime Auto 4,349
WFS Financial Owners Trust Sub Prime Auto 2,136
Fannie Mae Whole Loan Multi Family Balloon 1,870
Fannie Mae Whole Loan ABS Home Equity Agency 5,043
Fannie Mae Whole Loan ABS Home Equity Agency 6,031
Ford Auto Owners Trust Prime Auto 2,623
Honda Auto Receivables Owner Trust Prime Auto 1,987
Honda Auto Receivables Owner Trust Prime Auto 1,345
Sears Credit Account Master Trust Retail Credit Card 599
Monumental Life Insurance Company Cash on Hand 750
------------
123,554
------------
New York Life Insurance Company 3.65% - 6.06%,
------------
6/28/02 - 2/2/04 19,506
------------
Pruco Life Insurance Company 6.02% - 7.48%,
------------
9/7/04 - 11/30/05 23,087
------------
Security Life of Denver Insurance Company 7.39% - 7.65%,
------------
2/11/03 - 10/4/04 13,110
------------
SunAmerica Life Insurance Company 7.14%-7.63% 10,003
------------
State Street Bank and Trust Company Synthetic contract wrapper
#99035-LB1, 6.15%, *** (40)
INVESCO Group Trust for Retirement Savings Group Trust: Lambda I 691
------------
651
------------
Rabobank Nederland Synthetic contract wrapper
#SBC060201, 4.01%, *** (431)
Federal Home Loan Mortgage Company Agency Debenture 17,019
------------
16,588
------------
State Street Bank and Trust Company Synthetic contract wrapper
#99039, 5.08%, *** (6,134)
MBNA Master Credit Card Trust USA Monoline Credit Card 3,918
MBNA Master Trust Monoline Credit Card 1,663
MBNA Master Trust Monoline Credit Card 2,157
Description of Current
Identity of Issue Investment Cost Value
---------------------------------------------------- ------------------------------- ----------- ------------
National City Auto Rec Trust Prime Auto 5,153
American Express Optima CC MT Monoline Credit Card 5,302
American Express Optima CC MT Monoline Credit Card 3,209
Americredit Auto Receivable Sub Prime Auto 2,055
COAFT Sub Prime Auto 2,029
Chase Manhattan Auto Owners Trust Prime Auto 2,100
CMAC Conduit 4,921
Delta Funding HEL Trust Home Equity Monoline 3,477
Federal Home Loan Mortgage Corporation Agency Hybrid ARM 2,112
Federal Home Loan Mortgage Corporation Agency Debenture 5,624
Fannie Mae Whole Loan Agency Debenture 8,767
Fannie Mae Whole Loan FHA/VA Reperforming 4,448
Federal Home Loan Mortgage Corporation ABS - Home Equity Agency 2,759
Fleet Credit Card MT Bank Credit Card 4,459
Ford Auto Owners Trust Prime Auto 741
Nissan Auto Owners Trust Prime Auto 1,047
Prudential Secured Financing Conduit 5,838
Sears Credit Account Master Trust Retail Credit Card 1,277
Sears Credit Account Master Trust Retail Credit Card 282
Sears Credit Account Master Trust Retail Credit Card 4,328
Sears Credit Account Master Trust Retail Credit Card 4,442
Citibank Credit Card Master Trust II Bank Credit Card 3,329
Citibank Credit Card Master Trust II Bank Credit Card 4,377
Federal Home Loan Mortgage Corporation Agency Debenture 1,135
Federal Home Loan Mortgage Corporation Agency Debenture 16,657
Fannie Mae Whole Loan ABS- Home Equity Agency 3,208
Fannie Mae Whole Loan ABS- Home Equity Agency 2,539
Capital One Master Trust Monoline Credit Card 6,293
United States Treasury Treasury Note 5,437
Honda Auto Receivables Owner Trust Prime Auto 1,012
United States Treasury Treasury Note 448
State Street Bank and Trust Company Cash on Hand 1,311
------------
121,720
------------
UBS AG Synthetic Contract Wrapper
#5029, 5.16%, *** (1,647)
Americredit Auto Receivable Sub Prime Auto 3,149
COAFT Sub Prime Auto 2,537
Chase Manhattan Credit Card MT Bank Credit Card 2,721
Copelco Capital Fund Corporation Small Equipment Lease 191
Federal Home Loan Mortgage Company Agency Hybrid ARM 2,206
Federal Home Loan Mortgage Company Agency Debenture 2,264
Federal Home Loan Mortgage Company Agency Debenture 11,105
Fannie Mae Whole Loan ABS- Home Equity Agency 3,208
Fannie Mae Whole Loan ABS- Home Equity Agency 3,016
Fleet Credit Card MT Bank Credit Card 3,249
Residential Asset Mtg Production Inc ABS- Home Equity Agency 3,018
TIAA Cref Conduit 2,602
Union Acceptance Corporation Sub Prime Auto 1,508
UBS AG Cash on Hand 1,698
------------
40,825
------------
Description of Current
Identity of Issue Investment Cost Value
---------------------------------------------------- ------------------------------- ----------- ------------
* Boston Safe Deposit and Trust Company Temporary cash investment 35,342
------------
Total Interest Income Fund ** 777,183
------------
Asset Allocation Fund
---------------------
* Barclays Global Investors U.S. Tactical Asset
------------
Allocation Fund F 13,891,416 units ** 197,397
------------
Global Equity Fund
------------------
* Barclays Global Investors U.S. Equity Market
Fund F 1,587,706 units 33,199
* Barclays Global Investors EAFE Equity
Index Fund E 744,540 units 9,553
------------
Total Global Equity Fund ** 42,752
------------
Mid and Small Cap Stock Fund
----------------------------
------------
------------
Extended Equity Market Fund F 1,933,288 units 22,793
------------
International Fund
------------------
------------
------------
International Stock 292,991 units 3,759
------------
Loan Fund
---------
------------
* Loans to Plan Participants 5.25% - 5.75% ** 282,287
------------
TOTAL $ 4,471,815
============
* Party-in-Interest.
** Participant-directed investment, cost not required.
*** Synthetic Insurance Contracts, no stated maturity.
SIGNATURE
Pursuant to the requirements of the Securities Exchange Act of 1934, the Plan Administrator for the Plan has duly
caused this annual report to be signed by the undersigned thereunto duly authorized.
SBC SAVINGS AND SECURITY PLAN
By SBC Communications Inc., Plan Administrator
for the Foregoing Plan
By /s/ Karen E. Jennings
------------------------------------------
Karen E. Jennings
Senior Executive Vice President -
Human Resources and Communications
Date: June 25, 2003
EXHIBIT INDEX
Exhibits identified below, Exhibit 23 is filed herein as an exhibit hereto and Exhibit 99 is furnished and
attached hereto.
Exhibit
Number
-------------
23 Consent of Independent Auditors Ernst & Young LLP
99 Certification of Periodic Financial Reports