REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING
FIRM
Plan
Administrator and Audit Committee of the Board of
Directors
Community
Bancorp & Designated Subsidiaries Retirement Savings
Plan
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, 2016 and
2015, and the related statement of changes in net assets available
for benefits for the year ended December 31, 2016. 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 of
the Plan as of December 31, 2016 and 2015, and the changes in net
assets available for benefits for the year ended December 31, 2016,
in conformity with accounting principles generally accepted in the
United States of America.
The
supplemental information in the accompanying schedule of assets
(held at end of year) as of December 31, 2016 has been subjected to
audit procedures performed in conjunction with the audit of the
Plan's financial statements. The supplemental information is
presented for the purpose of additional analysis and is not a
required part of the financial statements but includes supplemental
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
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 in the
accompanying schedule is fairly stated in all material respects in
relation to the financial statements as a whole.
Portland,
Maine
June
27, 2017
VT Reg.
No. 92-0000278
COMMUNITY
BANCORP & DESIGNATED
|
SUBSIDIARIES
RETIREMENT SAVINGS PLAN
|
|
|
|
Statements
of Net Assets Available for Benefits
|
|
|
|
|
|
|
December
31,
|
|
|
|
|
|
Assets
|
|
|
Investments,
at fair value
|
|
|
Money
market assets
|
$
1,813,136
|
$
762,244
|
Marketable
equity securities
|
7,109,000
|
6,209,295
|
Mutual
funds
|
11,541,376
|
11,091,514
|
|
|
|
Total
investments
|
20,463,512
|
18,063,053
|
|
|
|
Receivables
|
|
|
Employer
contributions
|
447,486
|
455,957
|
Participant
contributions
|
18,347
|
17,681
|
Participant
loans
|
487,401
|
467,208
|
Accrued
interest and dividends
|
258
|
300
|
|
|
|
Total
receivables
|
953,492
|
941,146
|
|
|
|
Net
assets available for benefits
|
$
21,417,004
|
$
19,004,199
|
The accompanying notes are an integral part of these financial
statements.
COMMUNITY
BANCORP & DESIGNATED
|
SUBSIDIARIES
RETIREMENT SAVINGS PLAN
|
|
|
Statement
of Changes in Net Assets Available for Benefits
|
|
|
Year
Ended December 31, 2016
|
|
|
|
|
|
Additions to net
assets attributed to:
|
|
Investment
and participant loan income
|
|
Net
appreciation in fair value of investments
|
$
1,203,152
|
Interest
and dividends from investments and participant loans
|
848,835
|
|
|
|
2,051,987
|
|
|
Contributions
|
|
Employer’s
|
591,045
|
Participants’
|
444,583
|
Rollovers
|
19,048
|
|
|
|
1,054,676
|
|
|
Total
additions
|
3,106,663
|
|
|
Deductions from net
assets attributed to:
|
|
Benefits
paid to participants
|
647,293
|
Administrative
expenses
|
46,565
|
|
|
Total
deductions
|
693,858
|
|
|
Increase
in net assets available for benefits
|
2,412,805
|
|
|
Net assets
available for benefits
|
|
|
|
Beginning
of year
|
19,004,199
|
|
|
End
of year
|
$
21,417,004
|
The accompanying notes are an integral part of these financial
statements.
COMMUNITY BANCORP & DESIGNATED
SUBSIDIARIES RETIREMENT SAVINGS PLAN
Notes to Financial Statements
December 31, 2016 and 2015
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 or Community Bancorp), 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, 2016 and 2015.
Forfeitures may be used to reduce future employer contributions.
During 2016 and 2015, $19,220 and $10,439, 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 the participant.
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
measurement.
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, 2016 and 2015
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, 2016 and
2015.
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, 2016 and 2015
|
Fair
Value Measurement at
|
|
|
|
|
|
|
|
|
December
31, 2016
|
|
|
|
|
|
Money market
assets
|
$
1,813,136
|
$
1,813,136
|
|
|
|
Marketable equity
securities
|
7,109,000
|
7,109,000
|
|
|
|
Mutual
funds
|
11,541,376
|
11,541,376
|
|
|
|
Total assets at
fair value
|
$
20,463,512
|
$
20,463,512
|
|
|
|
December
31, 2015
|
|
|
|
|
|
Money market
assets
|
$
762,244
|
$
762,244
|
|
|
|
Marketable equity
securities
|
6,209,295
|
6,209,295
|
|
|
|
Mutual
funds
|
11,091,514
|
11,091,514
|
|
|
|
Total assets at
fair value
|
$
18,063,053
|
$
18,063,053
|
COMMUNITY BANCORP AND DESIGNATED
SUBSIDIARIES’ RETIREMENT SAVINGS PLAN
Notes to Financial Statements
December 31, 2016 and 2015
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 determination 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 $44,065 for the year
ended December 31, 2016.
The
Plan allows for participant contributions to be invested in common
stock of the Company. At December 31, 2016 and 2015, the Plan held
462,374 and 435,740 shares, respectively, valued at $7,109,000 and
$6,209,295, 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, 2016
|
|
(c)
|
|
|
|
(b)
|
Description of
Investment
|
|
|
|
Identity of
Issue,
|
Including Maturity
Date,
|
|
|
|
Borrower,
Lessor,
|
Rate of Interest,
Collateral,
|
|
|
|
or Similar
Party
|
Par or Maturity
Value
|
|
|
|
|
|
|
|
|
Fidelity Money
Market Fund
|
Money
Market
|
**
|
$
1,807,476
|
|
Federated
Government Obligations Fund
|
Money
Market
|
**
|
5,660
|
|
American Balanced
Fund
|
Mutual
Fund
|
**
|
2,284,282
|
|
Dodge & Cox
Balanced Fund
|
Mutual
Fund
|
**
|
520,137
|
|
Growth Fund of
America, Inc.
|
Mutual
Fund
|
**
|
2,369,103
|
|
T. Rowe Price
Equity Income Fund
|
Mutual
Fund
|
**
|
1,100,638
|
|
Royce Premier
Investment Fund
|
Mutual
Fund
|
**
|
1,027,978
|
|
Vanguard Total
Stock Market Index Fund
|
Mutual
Fund
|
**
|
3,074,877
|
|
Vanguard Short Term
Bond Index Fund
|
Mutual
Fund
|
**
|
207,848
|
|
EuroPacific Growth
Fund
|
Mutual
Fund
|
**
|
956,513
|
*
|
Community
Bancorp.
|
Common
Stock
|
**
|
7,109,000
|
|
|
|
|
Investments
at fair value
|
|
|
20,463,512
|
|
|
|
*
|
Participant
loans
|
2.88% -
4.81%,
|
|
|
|
|
various
maturities
|
-
|
487,401
|
|
|
|
|
|
$
20,950,913
|
|
|
|
*
|
Indicates a
party-in-interest to the Plan.
|
|
|
|
**
|
Participant
directed investments, information not required.
|
|
|
|
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.
COMMUNITY
BANCORP & DESIGNATED SUBSIDIARIES
|
RETIREMENT
SAVINGS PLAN
|
DATE: June
27, 2017
|
/s/
Kathryn M.
Austin
|
|
|
Kathryn
M. Austin, President & Chief
|
|
|
Executive
Officer, Community Bancorp.
|
|
|
(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
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